<BREAKFAST WITH THE FOOL>

Thursday, December 31, 1998

"Change alone is unchanging." -- Heraclitus

Latest Market Numbers

Closer to Consummation

AT&T (NYSE: T) got a belated Christmas present from the U.S. Justice Department when the long-distance phone giant won approval for its proposed acquisition of cable operator Tele-Communications Inc. (Nasdaq: TCOMA). The green light for the merger, which would enable AT&T to get back into the local residential phone business, is contingent on the divestiture of TCI's roughly 23.5% interest in Sprint Corp.'s (NYSE: FON) Sprint PCS wireless communications venture over five years.

AT&T and TCI still need a stamp of approval from the Federal Communications Commission (FCC) deeming that the merger is in the public's interest. But the FCC appears unlikely to derail the deal and is expected to reach a decision sometime early next year. More problematic, in the view of some FCC staff members, are the proposed acquisition of Ameritech Corp. (NYSE: AIT) by SBC Communications (NYSE: SBC) and the planned merger between Bell Atlantic (NYSE: BEL) and GTE Corp. (NYSE: GTE).

Early yesterday, the Federal Trade Commission (FTC) OK'd the purchase by British Petroleum (NYSE: BP) of Amoco (NYSE: AN) as long as the companies sell 134 gas stations in eight markets and nine oil-product terminals. BP and Amoco expect to close the deal today at 4 p.m. Eastern time. Not so lucky are rivals Exxon (NYSE: XON) and Mobil (NYSE: MOB) in their proposed merger, which is likely to undergo much closer scrutiny by the FTC.

News to Go

Of particular relevance to Breakfast Fools, General Mills Inc. (NYSE: GIS), the maker of Cheerios and Wheaties, unseated Kellogg Co. (NYSE: K) for the first time as the largest U.S. cereal maker based on revenue. General Mills had 32.5% of the U.S. market for the 12-week period ended Dec. 6 compared with Kellogg's 31.6% share, according to Information Resources Inc.

South Korea agreed to sell a 51% stake in its troubled Korea First Bank to an international consortium led by Newbridge Capital that consists of GE Capital Services, a unit of General Electric (NYSE: GE), and at least five other entities. The deal would be the first time foreign investors are allowed to buy a South Korean commercial bank. Korea First Bank is capitalized at 1.6 trillion won ($1.33 billion) and has 339 branches domestically and abroad.

Northwest Airlines (Nasdaq: NWAC) warned Wall Street analysts of a wider-than-anticipated fourth quarter loss due to business lost during a strike staged by its pilots in September and higher maintenance costs. The nation's fourth largest airline expects to see a 5% drop in its Q4 profit per passenger on top of a 3% increase in costs.

Acquisitive turf and forage seed company AgriBioTech's (Nasdaq: ABTX) planned purchase of the alfalfa seed business of privately held Helena Chemical Co.'s AgriPro Seeds Inc. fell through after the two parties "were unable to reach an agreement."

In-flight catalog retailer SkyMall Inc. (Nasdaq: SKYM) announced the resignation of director and co-founder Alan Ashton and said that CEO Robert Worsley bought Ashton's shares in the company for $7.35 a piece, or $17.6 million, raising his stake to 4.6 million shares, or 54% of shares outstanding. SkyMall shares have surged as high as $48 (closing at a high of $40 3/4 Tuesday) from trading under $5 just a week and a half ago on news that the company's Internet sales will increase sevenfold this year.

More Foolishness

Calling all Fools! This is the last day of 1998 and of the Fool's second annual charity drive to help fight hunger. We've raised about $120,000 so far, but we still need support from Fools like you, so make your contribution now!

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Yi-Hsin Chang (TMF Puck), Writer
Jennifer Silber (TMF Amused), Editor

</BREAKFAST WITH THE FOOL>