Archived from groups: alt.cellular,alt.cellular.cingular,alt.cellular.attws (
More info?)
[POSTED TO alt.cellular.attws - REPLY ON USENET PLEASE]
In <I0wTc.1005$TI4.538@newssvr15.news.prodigy.com> on Sat, 14 Aug 2004
22:05:28 GMT, "Chris Russell" <noone@nowhere.nospam> wrote:
>A merger is a fluid give and take situation.
Not true. Once a definitive agreement has been signed, it can only be
modified according to the terms of the agreement.
>Once the merger is complete
>Cingular will have to divest $8.25 billion of spectrum and/or customers.
Also not true. $8.25 billion is just the point at which any party (e.g.,
Cingular) could walk from the deal. In other words, if the FCC required $9
billion of divestiture, Cingular could walk; OTOH, if the FCC required $8
billion of divestiture, Cingular would still be bound by the deal. In
addition, that $8.25 billion is an amount of assets (e.g., spectrum), not
customers.
>By the way, go to the site below and read sec 6.5(b) to see that the
>'aggregate negative Net Effects' that are to be sold off is $8.25B as
>referenced in your SEC filing you posted.
Indeed, do go and actually read it, more carefully.
Here are the relevant parts (numbered for reference below):
1) Nothing in this Agreement shall require, or be construed to require,
Cingular, Cingular Wireless, BellSouth, SBC or their respective
Subsidiaries to take any action or enter into any agreement with
respect to any of its assets, business or operations ... that would,
individually or in the aggregate, reasonably be expected to result in
the aggregate negative Net Effects being more than the Material
Adverse Amount (as defined in Section 6.5(b) of the Cingular
Disclosure Letter (a "Material Adverse Condition")).
2) For purposes of calculating Net Effects with respect to the sale of a
market or spectrum it is agreed that (i) the Net Effects of the sale
of a market owned by any of the Company, Cingular or Cingular
Wireless will be an amount equal to the Per Subscriber Amount (as
defined in Section 6.5 of the Cingular Disclosure Letter) multiplied
by the number of subscribers in the system and operations in such
market proposed by Cingular, in good faith, to be sold, and (ii) the
Net Effects of the sale of spectrum-only shall be $0.50 per MHz POP.
In short, it simply says (1) that any party can walk from the deal if the
government requires more than $8.5 billion worth of divestiture, and (2) that
the value of divestiture is measured by percentage of the subscriber base.
It does *not* say that *any* divestiture is required!
>It is not the amount that
>Cingular would have to pay if they backed out of the deal.
Of course not -- that's covered elsewhere in the definitive agreement.
>And my last message was not rude,
It was actually quite rude.
>you just don't like to hear anyone that
>puts a logical statement that contradicts your thinking.
I just don't like rudeness and bad information.
>You are not the
>end all be all arbiter of things Cingular
True.
--
Best regards,
John Navas <http://navasgrp.home.att.net/>
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