Cingular Wireless L.L.C., AT&T Wireless Services Inc. and AT&T Corp. reported an agreement resolving issues related to the use of the AT&T brand in connection with Cingular’s pending acquisition of AWS, as well as a provision for the purchase of AT&T network services by the merged mobile carrier.
The branding agreement modifies AWS’ current brand license agreement with AT&T and will allow Cingular to use the AT&T brand name for six months beyond the closing of its acquisition of AWS in an attempt to reduce customer confusion. Cingular said it intends to use its own brand name for the combined company following the acquisition and will cease to use the AT&T brand at the end of the transition period.
AT&T is expected to use the AT&T Wireless brand name or some form of the name for its own wireless service, which will use Sprint PCS’ network as part of a mobile virtual network operator agreement signed between the two companies earlier this year.
AT&T also announced that its current network services agreement with AWS has been modified and extended for up to 17 months and calls for AT&T to provide the combined Cingular/AWS with international long distance, private line services and corporate telecommunications services. AT&T noted the agreement represents a $100 million commitment.
In an unrelated story, SBC Communications Inc., which controls 60 percent of Cingular, filed a registration statement with the Securities and Exchange Commission to sell up to $15.5 billion in debt and stock to help fund Cingular’s acquisition of AWS. SBC has previously reported that its share of the acquisition would amount to approximately $21 billion, and it expected to finance between $10 billion and $13 billion toward the purchase. BellSouth Corp., which controls 40 percent of Cingular, said it would fund approximately $15 billion of the acquisition price and has already sold some of its Latin America assets to help fund the purchase.
