Friday, January 28, 2005

These fingers are made for walkin', and that's just what they'll do . . .

Yahoo! News - SBC, AT&T discuss merger

SBC to sell its directory business to fund AT&T acquisition.

Oh, nobody's talking about it yet, but they will. If SBC is successful in acquiring AT&T, a move akin to throwing a drowning man a cinderblock, they're going to need to raise some big bucks. Where else can they raise several billion other than their lucrative directory business?

SBC's directory business generates nearly $4 billion in revenue with a substantial portion of that falling to the bottom line. The problem is that it's been a zero-growth business, and Wall Street rewards growth.

SBC will likely sell their directory business to a consortium of investment banking firms who will pretty it up for the public markets. The investors behind Canada's YPG, the spin off of the directory operation from Bell Canada and the spin off of Qwest Dex's directory business have reaped huge windfalls.

Just remember that you heard it here first.


Anonymous Anonymous said...

I'd be surprised if SBC has not already prepared the "book" and did so in advance of their buying of ATT.

10:07 AM  

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