AT&T; goofed, and now shareholders will pay.
Ma Bell revealed yesterday that because of an "undetected
electronic file transfer error" which omitted information from
its March Securities and Exchange Commission filing, the
company will be forced to delay by a month the planned
exchange of $10 billion of AT&T; stock for shares in AT&T;
The exchange offer is now due to take place in April. But
AT&T; stressed the change will not delay the timing of the
Wireless split-off this summer.
The computer snafu is yet another setback for the giant,
which plans to split into three new companies and create a
tracking stock for the consumer long-distance unit by next
The company has reduced profit forecasts four times since
May. And it has already pushed back the initial public
offering for its broadband unit to September.
To top it all off, AT&T; has lost more than half its value in
the last year.
Analysts say the filing error is just one new indication of the
risks involved in executing the complicated restructuring.
In addition to the filing glitch, AT&T; said it would retain $3
billion of AT&T; Wireless stock after the spinoff to sell as a
debt-reduction move. Ma Bell previously said it would
distribute all of its remaining stake in AT&T; Wireless to
The about-face clearly surprised some investors. AT&T; fell
more than 3 percent to $21.76.
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