AT&T;, Comcast Holders OK Deal

AT&T; Corp. and Comcast Corp. on Wednesday won shareholder approval for the planned $27-billion merger of AT&T; Broadband with Comcast, which would create the nation’s No. 1 cable television operator, with more than 22 million customers.

That go-ahead came as AT&T; Corp. Chairman and Chief Executive C. Michael Armstrong said that President David Dorman is the front-runner to succeed him, and that a plan to issue tracking shares for the consumer long-distance telephone unit may be scrapped.

“It’s fair to assume David Dorman would be the front-runner,” said Armstrong, who will leave AT&T; to become chairman of the combined AT&T; Comcast when the sale of AT&T;’s cable unit closes this year.

Armstrong spoke at the annual meeting in Charleston, S.C. The tracking stock was part of his October 2000 plan to stem a share decline by breaking up AT&T.;

The approval of a 1-for-5 reverse stock split and the sale of AT&T; Broadband to Comcast helped bring to an end Armstrong’s vision of creating a cable, telephone and Internet empire. Dorman, 48, would take over a company that has forecast a mid-20% drop in consumer long-distance sales this year.

Telephone giant AT&T; in December agreed to sell its cable unit to Comcast as part of a restructuring that dismantled its vision of becoming a one-stop shop for telephone, data and video services.

The sale of AT&T; Broadband to Comcast will leave AT&T; with telephone and data operations serving about 50 million residential customers and 4 million corporate customers. The combined company would serve most of the top U.S. metropolitan markets.

Philadelphia-based Comcast, which also owns the Flyers professional hockey team and 76ers pro basketball team, would more than double its cable TV subscriber base and add cable-based local telephone services to its product mix.

The deal must be approved by the Justice Department and the Federal Communications Commission.

Shares of AT&T; shed 23 cents to close at $9.78 on the New York Stock Exchange. Comcast’s Class A shares lost 76 cents to $22.43 on Nasdaq.

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Reuters and Bloomberg News were used in compiling this report.