NEW YORK-Cingular Wireless L.L.C.’s parent companies SBC Communications Inc. and BellSouth Corp. are reportedly looking at an initial public offering for their wireless division sometime next year to help fund expansion plans that could include a merger with industry rival AT&T Wireless Services Inc., according to a report in the Wall Street Journal.
“At Cingular, there is strong momentum building for both an acquisition or an IPO,” an unnamed source told the Wall Street Journal. “This is more than just running scenarios.”
A number of industry sources have made similar predictions of a possible Cingular/AT&T Wireless merger noting both carriers have been cleaning up their balance sheets and consolidating their operations for such a move. Cingular was rumored to be looking at acquiring T-Mobile USA Inc. last year, but was reportedly rebuffed by T-Mobile USA parent company Deutsche Telekom AG.
The news sent AT&T Wireless’ shares up more than five percent in early Tuesday trading to nearly $8 per share with above average trading volume.
