PHILADELPHIA – AT&T Corp.'s board is expected on Tuesday to allow the telephone and cable-television giant to begin talks with Comcast Corp., but a final decision on the surprise $40.5 billion offer to buy AT&T Broadband is unlikely for several days or weeks, people familiar with the situation said.
AT&T and Comcast declined to comment.
Comcast, the No. 3 cable television company, on Sunday launched an unsolicited bid to acquire AT&T's broadband unit, the nation's largest cable-television operator with 13.2 million subscribers. AT&T, which plans to spin off the business as part of a massive restructuring, has said AT&T Broadband is not for sale.
Due to its fiduciary responsibility to review reasonable offers, AT&T's board is unlikely to reject Comcast's offer outright, sources said.
Instead, the board is expected to allow AT&T's management to hold discussions with Comcast. The board also may draft a list of concerns or issues they would want resolved during any acquisition talks, sources said.
In addition to the price, AT&T's board will likely raise concerns about the proposed voting structure in Comcast's offer, sources said.
AT&T must weigh whether Comcast's bid offers greater value for shareholders than its plan to spin off AT&T Broadband as a separate company. AT&T last fall announced plans to split its main businesses -- broadband, wireless, business and consumer services -- into three companies with four separately traded stocks. AT&T Wireless Group Inc. on Monday became an independent company, marking the first stage of the restructuring.
Shares of AT&T gained $1.31, or 7 percent, to $20.02 on the New York Stock Exchange in late-morning trading. Comcast's class A special stock, which fell 7 percent on Monday on news of the bid, shed 60 cents to $38.70 on Nasdaq.