A.T.& T. alters merger to win audit ruling

Article Abstract:

AT&T has modified terms of its merger agreement with NCR Corp in an attempt to resolve questions about the accounting method to be used. AT&T wants approval from the Securities and Exchange Commission (SEC) to use the 'pooling-of-interest' method of accounting. If the pooling method is allowed, AT&T will use an all-stock transaction, which would be tax free for NCR's shareholders. Otherwise, AT&T will pay 60 percent in stock and 40 percent in cash, and the cash portion would be taxed. The problem concerns NCR's issuance of a $1 dividend during AT&T's initial attempt to acquire the company. The special dividend was issued to make the takeover less attractive to NCR stockholders. Regulations disallow companies from issuing special dividends prior to a merger, if they hope to qualify for the more financially favorable 'pooling-of-interests' accounting method.

Regulation misc. commercial sectors, Finance, Acquisitions and mergers, Dividends, Stockholder, Tax, Stock

---

A.T.& T. is questioned on accounting for NCR

Article Abstract:

Industry observers express surprise about AT&T's announcement that the company expects to use a 'pooling of interest' accounting method for its merger with NCR Corp. Such a use of pooling of interest is not consistent with a traditional interpretation of the rules. The issue must be decided by the Securities and Exchange Commission (SEC), which is deliberating. If AT&T is allowed to use the pooling of interest method, the comp~any plans an all-stock transaction, which would be tax-free to NCR's shareholders. Otherwise, AT&T plans to pay NCR's shareholders 60 percent in stock and 40 percent in cash, and the cash would be subject to taxation. On Monday, Jul 1, 1991, AT&T announced that it believed it would be able to account for the merger using pooling of interests.

Telephone communications, exc. radio, Cases

---

Similar abstracts:

• Abstracts: A 'Baby Bell' outgrows its siblings. A.T.&T. and 3 regional Bells post slightly higher profits. A.T.&T.'s income rises 19%; 'Baby Bell' profits are mixed
• Abstracts: A.T.& T. forming alliances for wireless computing. State Dept. contract gives Wang a boost. AT&T's computer contract
• Abstracts: Sony and others asking, Gilbert who? An alliance of A.T.&T. with NEC; chip development pact raises question about Sematech consortium
• Abstracts: Nynex trial set to open in capital; charges of violating A.T.&T. breakup pact. F.C.C. moves to expand phone choice
• Abstracts: Rebuttal spot by US Sprint to A.T.&T. MCI pulls account from Wells, Rich. Army uses computer disks to recruit video generation

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.