AT&T in 2005: Merging with SBC

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Excerpts

Early History Following the invention of the telephone by Alexander Graham Bell in 1876, Bell Telephone was established in 1877 and New England Telephone in 1878. The two companies were consolidated as National Bell Telephone in 1879...

SBC was the number two local phone company in the US, after Verizon. A Fortune 50 company, SBC along with its subsidiaries, provided a full range of voice, data, networking, e-business, directory publishing and advertising, and related services to businesses, consumers and other telecommunications providers...

In January 2005, SBC announced that it was merging with AT&T for $16 billion. For AT&T, the merger represented the next step forward in a series of mergers and breakups the company had been going through, since the early 80s. For SBC, the combination promised immediate global leadership in the enterprise segment where corporations and governments required complex communication solutions and services and access to advanced national and global networks...

On February 1 2005, SBC outlined its plan to meet its cost-cutting targets. In a presentation given to Wall Street analysts, SBC executives described plans to cut 13,000 jobs, or about 12% of the combined 163,000 work forces at SBC/AT&T. Many of those cuts were likely to occur through attrition.

Around 5,125 job cuts were planned in network operations departments including engineering, access, management and enterprise customer service. Another 5,100 redundant sales and business operations posts would be eliminated.

Exhibit 1: AT&T - SBC, Combined Strengths
Exhibit 2: Combined Company's Strategic Profile
Exhibit 3: AT&T - SBC, Profiles

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