WSJ.com - Boards of SBC and AT&T Approve $16 Billion Deal

WSJ.com - Boards of SBC and AT&T Approve $16 Billion Deal: "The boards of SBC Communications Inc. and AT&T Corp. approved a deal under which SBC will acquire AT&T for roughly $16 billion, mainly in stock.
SBC's board approved the transaction Sunday evening, while AT&T's board approved it just before 1 a.m. Monday.
The acquisition, subject to approval by AT&T's shareholders and regulatory authorities, is expected to close by the first half of 2006.
The deal aims to create the nation's largest communications company. The merger will end AT&T's 130-year history as an independent company, which began with the invention of the telephone.
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If completed, a combined SBC and AT&T would set the stage for an all-out war between phone giants and cable companies. Cable companies have been encroaching on the phone industry's turf, as they seek to gain control of telecommunications access to consumers' homes. Moreover, in the past few years, the Bells have been losing customers to alternative services such as cellphones and Internet calling. The deal would give SBC more sources of revenue and reduce its exposure to its threatened core business.
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In the past several years, Mr. Whitacre has steadily built SBC through a series of acquisitions to a company with $40.8 billion in revenue. By contrast, AT&T, with revenue last year of $30.5 billion, has seen its fortunes steadily dwindle in recent years. Today, AT&T is a fragment of the company that in the 1980s employed more than one million people. AT&T now employs fewer than 47,000.
At its peak, AT&T was the nation's phone company, with a monopoly on virtually all local and long-distance phone service in the U.S. Founded in 1875 -- around the same time as Sears Roebuck, Johnson & Johnson and Standard Oil -- AT&T was a cutthroat acquirer in the early 1900s, snapping up many rivals and thwarting others by denying them access to its long-distance system."