Baby Bell SBC acquires AT&T

SBC Communications has a
19 November 2005

SBC Communications has announced the final closure of its $16.9-billion acquisition of AT&T. The new entity will retain the AT&T name and switch over to its trading identity on the stock markets from SBC to AT&T's ticker identity 'T' from December 1.

SBC Communications Inc. closed its acquisition of AT&T Corp. yesterday (November 18, 2005) as California's regulators approved the transaction — the final approval needed for the merger of the companies' highly complementary networks, product portfolios, capabilities and shared heritage.

"We are hitting the ground running on Day One so that our customers and owners quickly realise the substantial benefits and synergies of this merger," said Edward E. Whitacre Jr., chairman and CEO of AT&T in a statement issued by the company. "The integration teams have been working for months to plan, solicit customer input and develop road maps for a successful transition. Now that the merger is closed, the teams are ready to execute and maximise the potential of this combined company."

The merger, which was announced in January 2005, was originally expected to close in early 2006 and is widely considered a "pivotal event" in the history of the US telecommunications industry.

Twenty-one years after the US Federal Communications Commission forced the old AT&T to split up, Ma Bell has come full circle. After the split, AT&T became a long-distance phone company. Its local phone business was split among several Baby Bells, one of which eventually became SBC. Now the two sides of the business have been reunited, but under a much different set of circumstances.

The US Telecommunications Act of 1996 laid down an elaborate set of rules to increase competition in America's burgeoning telecommunications industry, including competition between the local and long-distance telephone companies, ushering in sweeping changes.