|
AT&T sets wireless IPO
|
 |
March 28, 2000: 6:19 p.m. ET
Initial offering of wireless tracking stock could generate $13 billion war chest
|
NEW YORK (CNNfn) - AT&T Corp. said Tuesday it plans to raise up to $13 billion by creating a separate stock for its wireless operations in what would be the biggest initial public offering in the United States.
AT&T plans to issue 360 million shares of AT&T Wireless Group "tracking stock" for $26 to $32 a share, the company said in an amended filing with the Securities and Exchange Commission. AT&T Wireless Group is one of the largest wireless service providers in North America with 12 million customers.
The No. 1 U.S. long-distance telephone company said proceeds would be used for wireless network expansion, acquisitions, international growth and investments in start-up wireless technology companies. The size of the offering is much bigger than indicated when New York-based AT&T made its initial filings about the deal with regulators last month.
The company plans to sell 306 million shares in the United States and Canada while offering the remaining 54 million shares overseas.
AT&T may issue up to an additional 54 million shares if the underwriters exercise their over-allotment option to meet potential heavy demand.
Goldman Sachs & Co., Merrill Lynch & Co. and Salomon Smith Barney are global coordinators and managers for the offering.
The IPO would net AT&T $10.13 billion based on the sale of the 360 million shares at a midway point in the offering range, according to an amended prospectus filed with the Securities and Exchange Commission where the terms were revealed for the first time.
The IPO would reap some $13 billion if all the over allotment shares are exercised, at the top of the range, an AT&T spokesman said.
The first $7 billion raised in the IPO will be allocated to the wireless operations, while the remaining proceeds will be allocated to the AT&T common stock group, the filing said.
After the offering, AT&T will retain between 82.5 percent and 84.4 percent of the economic interest in the AT&T Wireless Group.
AT&T also reaffirmed its commitment to dispose the remaining economic interest it will continue to own in the AT&T Wireless Group in a timely manner.
Also called "targeted stocks" or "letter stocks," tracking stocks recognize that investors may find more or less value in a company's core businesses, and give companies another card to play when making deals.
Typically, the tracking shares carry reduced or no ownership rights, and allow company management to keep control of the assets represented by the tracking shares. 
|
|
|
|
|
|
AT&T
|
Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney
|
|
|
|
 |
|
