AT&T to split into 4

NEW YORK, OCT. 25. AT&T Corp. said on Wednesday that it would restructure into a family of four companies that will be separately traded and pay reduced dividends in an effort to boost a stock price that has fallen 47 per cent this year.

The move by the largest U.S. long-distance telephone and cable television company marks the boldest reorganisation of the corporate icon since it broke apart and created the Baby Bells in 1984. The plan will allow each of AT&T's major units - consumer, business, broadband, and wireless - to focus on its particular market niche and compete more nimbly, the company said.

The reorganisation marks a reversal of the company's strategy to become an `all distance' communications company that sold packages of local, long-distance, wireless telephone and Internet access services. It also dismantles nearly three years of bold acquisitions by the corporate giant.

Under the plan, which the company expects to complete in 2002, AT&T share-owners ultimately would own stock in four businesses. AT&T's wireless and broadband cable television businesses will trade as independent common stocks. The shrinking consumer telephone business will become a tracking stock, while the principal AT&T entity will be its business services unit.

The principal company, AT&T Business, which provides communications and networking to corporate customers, will trade on the New York Stock Exchange under the company's existing ``T'' symbol. It will also be the legal owner of the AT&T brand, which it will license to the other companies. AT&T Business will be the parent company of the AT&T consumer business, which will trade as a tracking stock. The four separate entities will continue to collaborate, the company said.

- Reuters

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Section  : Business
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