New York -- AT&T Corp. chairman C. Michael Armstrong said the company has
been entertaining offers for its AT&T Broadband unit, but he added that he
has not been actively seeking out suitors.
AT&T Broadband was thrust into play after Comcast Corp. announced a bid
to buy the unit for $51 billion in stock and assumed debt in July. Since then,
other rumored suitors for the unit have included The Walt Disney Co., Cox
Communications Inc., Microsoft Corp. and AOL Time Warner Inc.
Armstrong, speaking at the Goldman, Sachs & Co. 'Communacopia' conference
here, added that he did not seek out bidders after Comcast made its
'We have not gone out and contacted any company,' he said. 'But after we
announced the Comcast [offer], my phone started ringing off the hook. We felt
that the right course of action was to understand those inquiries, and that's
what we're doing.'
Armstrong declined to name companies that have made inquiries, but he had
some criteria for potential bidders: The combination would have to create
long-term value for shareholders, it would have to make strategic sense and it
would have to be pro-competitive.
'If [a proposal] enhances our strategy, builds long-term value and brings
competition, then we will seriously consider it,' he said. 'If combining the
business does not meet this criteria, we will continue to build value without
Armstrong also reiterated AT&T Broadband's intention to increase
cash-flow margins in the third quarter, but he did not give a specific target.
The MSO has some of the lowest cash-flow margins in the industry.
'The margins will improve,' he added.