AT&T Corp. has confirmed that the announcement by U.K.-based Vodafone Group
plc. has agreed to acquire the ten percent stake the U.S. telecommunications
company holds in Japan Telecom Co., Ltd. (Japan Telecom) for approximately US$1.35
billion in cash, or approximately $21,125 per share. The net after-tax proceeds
to AT&T are expected to be approximately $1 billion.
The transaction is expected to be completed in April 2001, and the proceeds
will be split evenly between AT&T and AT&T Wireless. Vodafone is strong
in many of the Western wireless markets today.
The boards of directors of AT&T and Vodafone have approved the definitive
agreement. Japan Telecom -- which was the telecommunications entity and part
of the former Japanese national railways system -- holds over a 50% share in
J-Phone, the group unit which is Japan's third-largest mobile phone operator.
AT&T acquired the Japan Telecom stake in August 1999 for approximately $612
million in consideration, consisting of cash and shares of AT&T Jens Corporation.
AT&T decided to divest the Japan Telecom investment following the recently
announced strategic alliance between NTT DoCoMo, Japan's largest wireless operator,
and AT&T Wireless. NTT DoCoMo acquired shares of AT&T preferred tracking
stock, equivalent to 406 million shares of AT&T Wireless tracking stock
(approximate16 percent economic interest in AT&T Wireless) for $9.8 billion
on January 22, 2001, in connection with its strategic alliance.