WSJ says SBC Communications to buy Ameritech
SINGAPORE (Reuters) - SBC Communications Inc is set to acquire fellow U.S. telephone company Ameritech Corp in a stock swap valued at over $55 billion, the Internet edition of the Wall Street Journal (WSJ) said Monday.
The online newspaper said the merger would be the biggest deal ever in the takeover-crazed telecommunications industry.
The merger would value Ameritech stock at 15 percent above its closing share price Friday of $43.875.
The newspaper quoted people familiar with the merger talks as saying the boards of the two companies met separately to consider the merger over the weekend and an announcement could come as early as Monday.
If the deal goes ahead, SBC would emerge as by far the biggest local phone monopoly in America, with annual revenue of more than $40 billion and over 57 million local lines in 13 U.S. states, it said.
Once announced, the merger would have to pass a review by the Federal Communications Commission and various other authorities, it said.
SBC management, led by chairman Edward E. Whitacre, would lead the combined company, while Ameritech chief executive Richard Notebaert would relinquish control, enriched with big exit payments.
Notebaert would receive a paycheck equal to at least three times his $1 million annual salary, plus lavish stock holdings. He and his top four executives could leave with more than $33 million in payments, it said.
The newspaper said the U.S. local telephone companies appeared to be trying to put back together the old AT&T monopoly they once constituted.
American Telephone & Telegraph Co (AT&T) was broken up in 1984 on antitrust grounds with its local networks split into seven bells.
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