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City | New media
AT&T; auction in disarray after leak
With bids due in by the end of today, Vodafone is understood to have decided to wait until the last minute before making its move, although approval for a cash and shares offer of almost $35bn (£19bn) is believed to have been given at board level. At present, US mobile phone company Cingular - owned by BellSouth and SBC - is the only certain bidder for America's third placed operator. It is expected to hand over details of its all-cash bid, which values AT&T at just over $30bn, today. But last night the valuation appeared to be thrown into doubt as the company's results for January were leaked to Reuters. They showed that AT&T lost 4% of its customers in January and the average revenue it made from each of them fell 10% compared with a year earlier. City insiders said the results would increase concerns among Vodafone's shareholders. Since speculation about Vodafone bidding for AT&T Wireless emerged last month, Vodafone shares have dropped more than 10%. Shareholders have voiced concerns about the possible financial impact of dumping the company's existing 45% stake in leading US mobile operator Verizon Wireless in favour of control of AT&T Wireless. Cingular, the country's number two operator, is also expected to make significant cost savings from the deal which Vodafone would not be able to emulate. The board of NTT DoCoMo, the Japanese mobile operator which has a 16% stake in AT&T Wireless, was meeting overnight to decide whether to table an offer but is expected to bow out, hoping instead for a good return on its original investment. T-Mobile, which owns the former Voicestream business, has ruled itself out of making a bid. Nextel, the fifth largest operator in the US, is still considering tabling an offer that would make use of its shares rather than cash. Separately, Vodafone yesterday announced the first proper step towards launching 3G services in Europe by unveiling a data card that can be plugged into a laptop and provides internet connection at broadband-like speeds. |
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