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AT&T, Inc. Message Board

  • Jake19Jr Jake19Jr Jan 8, 1998 8:44 AM Flag

    Teleport Deal---------More!

    Major owners in Teleport=TCI , Comcast, and one other-60%.
    $11 Billion price is around 50 times earnings, amazzzzzzzing multiple .
    Where are you TA??? Let's hear more comments on this deal.
    How about it Happy , Fred ???????????????????

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    • Question for anyone...If TCGI has 600 M shares outstanding and
      the proposed acquisition price is `$56 per share, how does this
      become an $11 Billion acquisition??? Just wondering if my
      calculator went bonkers on me...:-)

      As for Teleport and it's fit with AT&T...I think it's a good 1st
      step. Their network investments since their founding certainly
      will enhance AT&T's ability to offer Digital Link business nodal
      service to our customers...The question is, as someone else
      pointed out, how quickly and easily this network and their whole
      operations can be assimiliated. Hopefully, since it's not a
      totally foreign technology or concept, it'll go pretty quickly
      and will start adding to competitive winback revenues...Sales
      force integration should be relatively easy, unless cultures

      On the other hand, I'm a little bit concerned about the income
      statement...and what effect these losses will have on AT&T's
      P&L...Maybe the infrastructure investment TCGI is making will be
      more cost effective given AT&T's ability to buy in volume...and
      the financial cost of capital that T generates...(eg: AT&T's cost
      of capital should be a lot less than TCGI could justify on it's

      We'll just have to wait and see how this fits into the message
      that Mr. Armstrong will be delivering to Wall Street and the
      world at the end of January...Is this a small part, or is it THE
      basis for future strategies? I'm guessing the former...


      • 2 Replies to njfred
      • I wrote it down the way CNBC reported it , as for your question on cap , you tell me . I guess the pros don't know what they are
        talking about , huh !!

      • I think it would be a small part, but a crucial huge first step. As I mentioned in my previous post it lowers transport costs for all LD. They can now bypass the RBOCs more efficitively in virtuallly every major metro. It gives them a stronger, more competitive stance marketing to big businesses.

        Right now, it's the only move into local they can make. The regulatory environment right now will not allow them to
        effictively resell unbundled local loop. I really doubt they can get approval to buy an RBOC at the moment. Besides, if they were to buy
        a RBOC with all of its residential customers, that only gets them into a portion of the country;a slice of the pie, not the
        whole pie. They're only choice to get into residential is to fully develop Project Angel or wait until unbundled local loop is a
        reality. IMO, the RBOCs will have to truly offer fair priced unbundled local loop if they ever wish to touch LD.

        You're right other big moves will need to happen. AT&T needs to strengthen its international alliances. They also trail
        significantly in the Internet market. Look for them to buy or ally with @Home. A cable alliance might also be another interesting way to
        get back into local residential service and high-speed Internet. According to the Wall Street journal, a sticking point with the
        TCG transaction has been whether they will maintain long-term access to TCG's leased cable from Cox, TCI, and Comcast. This
        should give you an idea about where cable will figure into AT&T & Armstrong's vision of the future. It will be a key component.

        Thanks for the posting.

    • The deal would give AT&T a quick entry into the local phone markets of the nation's biggest urban centres, including New York City and Los Angeles. Big T is doing well now!

      By the way, My pick STRR is uping another 20% from last clos. Other stock probably are good buy opptunity. Good lock for every one!

      • 1 Reply to yuangu
      • I too recently picked up shares in STRR and am pleased with recent returns. I also bought FIBR, SEMI, AKLM, and ATC. I like
        em all and expect same to do well . Semi is the only laggard but I think that will change with earnings reports . Very fond of
        a stock in tech manufacturing called ACCM . Looking forward to a good year in '98. Recently sold T at 63 but am still
        following with an eye towards getting back in if it looks promising. Jury still out in my book , but this is the best stock board I've
        run across. That Lissy is a card and I like to read TA , Happy ,and
        the others. Have a good 'un !!

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