Venture outbids Vodafone with offer of $15 a share; better coverage, new services promised.
NEW YORK (CNN/Money)—Cingular Wireless said Tuesday it would buy AT&T Wireless Services Inc. for about $41 billion, topping a rival bid from Vodafone of Britain in a deal that would create the nation's biggest mobile phone company.
The combination of Cingular and AT&T Wireless will create the nation's No. 1 cell phone service provider.
Cingular, currently the nation's No. 2 cellular service provider, is paying about a 27 percent premium to shareholders of AT&T Wireless, the nation's No. 3 wireless phone provider. Vodafone, which had recently raised its offer to $38 billion, dropped out of the bidding Tuesday.
The deal would make Cingular the largest wireless carrier, ahead of Verizon Wireless, with about 46 million subscribers.
During a conference call, Cingular CEO Stan Sigman said that the deal should close by the fourth quarter and that the combined company will keep the Cingular brand name. Sigman will be the head of the combined company.
He also said it was likely that some employees would be "affected" by the merger but declined to discuss how many jobs may end up getting cut.
This will mark the first time I've had wireless service under anything other than the AT&T Wireless name. I carried a Sprint PCS phone for a few weeks in 2000 but never used it, since I already had my AT&T Wireless phone at that time (the Sprint phone was a freebie).
I imagine the workers at the AT&T Wireless campus near the lab are freaking out along about now....