IBEW Member Employees of ATT "Encouraged" by SBC Purchase

REDNOVA NEWS
UNIONS BLESSING SBC-AT&T DEAL; Analysts, However, Question $16B Price Tag

Poor AT&T Corp.

Fed up with layoffs and lack of growth, even AT&T union members are praising the planned takeover by SBC Communications Inc. for $16 billion, a deal that was officially announced yesterday after days of speculation the once-great phone giant would cease to exist as an independent firm.

"SBC's purchase of AT&T makes good sense," said Morton Bahr, president of the Communications Workers of America, which represents 15,000 union members at AT&T, about 400 of whom are based in Massachusetts.

The International Brotherhood of Electrical Workers, with fewer than 100 AT&T members left in the Bay State, said the takeover news was "encouraging" considering AT&T's poor performance of late and the prospects of growth with the far more vibrant SBC.

AT&T used to have a giant presence in Massachusetts, mostly in the Merrimack Valley, before it spun off much of its local operations via Lucent Technology, which itself has fallen on hard times. Lucent has laid off thousands of workers in recent years.

Now AT&T, which wouldn't release a state-by-state breakdown of its labor force, has fewer than 500 union members in Massachusetts, CWA and IBEW officials said yesterday.

Candice Johnson, a CWA spokeswoman, said it's not unusual for her union to embrace a megamerger if it means better growth prospects and protections for workers. She noted AT&T has been shedding and outsourcing jobs at a torrid pace in recent years, though she warned the union will be on guard for moves by SBC to weaken union strength.

The takover, which will face antitrust and regulatory hurdles, will make SBC the largest U.S. provider of landline and wireless communications service, with about $90billion in annual revenues.

"We've seized a great opportunity and asset in AT&T," SBC Chairman Ed Whitacre told analysts in a conference call. "We obtained these assets for a fair price that will pay for itself in a very short period."

Analysts have criticized the $16 billion purchase price for the deal, which is expected to close by the first half of 2006, as too much.

"AT&T's business doesn't seem that accretive or value-added," said Greg Gorbatenko, an analyst with Marquis Investment Research.

Herald wire services contributed to this report.
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Published: 2005/02/03 12:00:16 CST

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