- The Washington Times - Monday, March 6, 2006

NEW YORK (AP) — One way AT&T; Inc. hopes its $67 billion proposed merger with BellSouth Corp. will pay off is by ending redundant operations.

That means up to 10,000 job cuts over three years, mostly through normal employee turnover rather than layoffs, AT&T; Chief Financial Officer Rick Lindner said yesterday.

The deal, expected to close next year after shareholder and regulatory approval, would form the nation’s largest phone company by any measure. It would have nearly half of all lines, be the largest cell-phone carrier and the largest provider of broadband Internet service.

Because the merger would effectively unite three companies — AT&T;, BellSouth and Cingular Wireless LLC, their joint venture — executives expect that plenty of overlapping functions can be eliminated.

“This merger will allow us to move to a single brand for wireline, for wireless, for business and consumer, and that’s AT&T;,” said Randall Stephenson, AT&T;’s chief operating officer. “A single brand is much more cost-efficient and far more effective.”

If the announced job cuts aren’t offset by hiring, they may be felt particularly strongly in Atlanta, where both BellSouth and Cingular are based. Cingular’s headquarters will remain there, but San Antonio, where AT&T; is based, will be the corporate headquarters.

Georgia Gov. Sonny Perdue and Atlanta Mayor Shirley Franklin said yesterday they both will fly to Texas soon to try to persuade AT&T;’s executives to move their headquarters to Atlanta.

“It’s hard to replace BellSouth,” Ms. Franklin said. “They’ve contributed so much over the last decade. We’re anxious for their national headquarters to move here.”

Before the cuts, the combined company would have an estimated 317,000 employees, including Cingular.

The 10,000 planned cuts are in addition to the 26,000 job cuts AT&T; has already announced — 13,000 because of SBC’s acquisition of AT&T; Corp., which closed in November, and 13,000 because of shifting priorities in its operations.

At the Communications Workers of America, which would have about 200,000 workers at the combined company, spokeswoman Candice Johnson said the merger would be a “good opportunity for job growth” as the company expands into new technologies.

AT&T; expects the acquisition announced Sunday to save it $2 billion annually at first, increasing to $3 billion a year by 2010.

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