Merger mania has officially hit the wireless sector, as daily rumors swirl around AT&T Wireless
Reports have circulated that AT&T Wireless is possibly fielding offers from several peers, including Cingular (a joint venture between SBC
Vodafone's purported interest has been particularly controversial since it currently has a 45% stake in Verizon Wireless -- subsidiary of Verizon Communications
But the best stink bombs were saved for this week. With suspicious timing, rumors developed into a Reuter's story late Thursday afternoon. Insiders apparently were reporting a frightening loss of customers, net income, and decline in Average Revenue Per User (ARPU) for AT&T Wireless in the month of January. Of course, the rumors may be true but can't be substantiated. But that's not the intent -- it's simply meant to scare buyers.
The big guns came out blazing, though, when trial lawyer Roger Ellis filed a class action lawsuit against AT&T Wireless in the late afternoon. Apparently Mr. Ellis suddenly feels compelled to defend all AT&T Wireless customers from years of deception and fraud. The claimed willful wrongdoing on part of the company even extends to fraudulent billing in order to "ruin their best customers' credit".
Interestingly, the press release spends less time describing the specific damage done to the class, and more time wagging a finger at potential corporate suitors of the company. In no uncertain terms, Mr. Ellis warns that a huge wave of lawsuits will cost a potential buyer countless millions of dollars.
While AT&T Wireless certainly has customer service issues to clean up (as all providers do), willful destructive behavior to loyal customers in order to line executive pockets with millions of dollars somehow seems melodramatic.
Especially the night before final calls in a potential $35 billion merger. Especially when the rant comes from a class-action trial lawyer.
Motley Fool contributor Dave Mock avoids ladders, black cats, and cracks in the pavement -- but does not consider himself superstitious. He owns shares of Nextel. Dave is co-author of Tapping into Wireless.