After Shares Sold, AT&T Stock Falls
to Lowest Level in 10 Years
This article contains material from Bloomberg News.
By Brendan January
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| Jun 12, 2002 (The Record - Knight Ridder/Tribune
Business News via COMTEX) -- AT&T Corp. stock fell Tuesday to its
lowest level in more than 10 years after the company sold 230 million
shares to raise $2.52 billion. The stock declined 52 cents to close at
$10.39, bringing the price down more than 38 percent this year. AT&T
sold stock for the possible purchase of AT&T Canada Inc. In 1999,
AT&T agreed to buy AT&T Canada before June 2003. According to the
agreement, the price rises 4 percent each quarter that AT&T doesn't
make the purchase. The current price is $3.3 billion. AT&T has
struggled due to the slowing economy and the millions of customers who
have switched from long distance to wireless and e-mail. Comcast Corp. is
buying AT&T's cable business, known as AT&T Broadband, for about
$54 billion. After the sale, AT&T stock is expected to trade for about
$3.50. AT&T plans a 1-for-5 reverse stock split to quintuple the share
price after the company completes the sale of the cable unit later this
year. On May 29, Moody's Investors Service cut AT&T's credit rating to
two notches above "junk" status, affecting about $25 billion of
debt, saying the company will be challenged to boost revenue amid rising
competition for its core business. Moody's cut AT&T's senior unsecured
debt from A3. Its rating outlook is negative.
This article contains material from Bloomberg News. By Brendan January |