Sure, they're fun, but nothing throws a wrench in the old cliche mill like a three-day weekend. Merger Tuesday? Either way, Cingular stole the show, ending months of speculation with a $41 billion offer for AT&T Wireless. A pair of high-profile hookups in the financial services sector -- offers were made for Greenpoint and Providian -- had investors equally excited.

Imagine, all this while Comcast's courtship of Disney continues. Investors traditionally view mergers and acquisitions activity as a sign of a healthy market, and proceed to bid stocks higher. It can be a virtuous circle, evidenced today by another 1% jump in the S&P, but there's no guarantee it will continue. Enjoy it, nonetheless.

In today's Motley Fool Take:

Cingular Snags AT&T Wireless

By Dave Mock

Investors were thrilled that AT&T Wireless(NYSE: AWE) didn't waste any time accepting a $15-per-share ($41 billion in cash) takeover bid from rival Cingular Wireless (a joint venture between SBC(NYSE: SBC) and BellSouth(NYSE: BLS)) this morning.

It's now official -- the nation's No. 2 and No. 3 wireless service providers will combine operations to overtake the No. 1 seat from Verizon Wireless (a subsidiary of Verizon Communications(NYSE: VZ)). Thick-skinned investors waiting through periods of turmoil with AT&T Wireless's billing and number portability problems have been rewarded with a 70% share-price increase since the beginning of the year.

Apparently, the only serious bidding competition came from Vodafone(NYSE: VOD), which finally chose to bow out rather than divest its 45% stake in Verizon Wireless to pick up AT&T Wireless. Vodafone shareholders had been voicing their displeasure with the possibility of the deal by dropping the stock on the London exchange Monday by 2.6%; maybe CEO Arun Sarin took the cue to pass on an expensive opportunity.

Regardless of exactly how the bidding went down, the focus is now on what's ahead: a consolidated wireless market. After years of speculation, the "big six" of wireless are now down to five.

Company Customers (approx.)
Cingular/AT&T Wireless 46 million
Verizon Wireless 37.5 million
Sprint PCS (NYSE: PCS) 20 million
Nextel (Nasdaq: NXTL) 13 million
T-Mobile (NYSE: DT) 13 million

Regulatory approval remains, of course, but most industry experts believe that the Federal Trade Commission (FTC) and Federal Communications Commission (FCC) will give the green light to the deal. With all the complaints surrounding wireless service in the U.S., consolidation is seen as one method to limit those annoying dropped calls due to holes in coverage maps. The FCC has also indicated on several occasions that competition in the U.S. is robust and could withstand fewer competitors.

The mega-deal -- supposedly the largest all-cash transaction in U.S. history -- has also opened up even more speculation about further consolidation in the industry. While Sprint PCS has indicated it's not interested in the merger game, other players are looking at options to build customer bases and reduce costs.

As usual, merger aftershocks are now permeating the market, with speculation rampant about how this first deal will influence other companies. Shares of Nextel, Sprint PCS, and Deutsche Telekom AG all jumped more than 5% higher mid-day on news of the merger.

Motley Fool contributor Dave Mock wonders just what $41 billion in cash looks like. He owns shares of Nextel. Dave is co-author of Tapping into Wireless.

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Krispy Kreme Stays Hot

By Alyce Lomax

Despite the anti-sugar set, there will always be a few safe bets for a sugar fix. Krispy Kreme(NYSE: KKD) served up an exciting fourth-quarter preview today. The now-famous (and for some, perhaps, infamous) "hot light" has still got some pretty compelling allure.

Despite a market that has put Krispy Kreme's stock price on a diet since last summer, the company comes with some serious recommendations. It happens to be a Motley Fool Stock Advisor pick; it was also Fool Rick Munarriz's choice for the Stocks Fools Love feature last week, as he predicted its power to withstand current no-fun dietary forces.

While I've pondered the effects of the current anti-carb craze on people's eating habits, we're not talking about some package of cold, hard cookies off the shelf at your local Safeway(NYSE: SWY) or Kroger(NYSE: KR). Take that, Keebler Elves.

I happen to know some extremely healthy eaters who have given up the high-carbohydrate diet (they have far more discipline than I). I also know that there's a school of thought that total abstinence from indulgence is a recipe for dietary failure. I've noticed that when they are in the mood for a little decadence, generally it's for something worthwhile (even if it means tagging a little extra running or spinning into the workout). And many people consider Krispy Kreme's doughnuts to be a worthwhile indulgence indeed, especially when they're hot off the presses.

Krispy Kreme's fourth-quarter systemwide sales increased 25.6%, helped by new store openings, with same-store sales bulking up 10.7%. It stood by its fourth-quarter estimate, which projected earnings of $0.26 per share. Fiscal 2004 earnings are expected to come in at $0.92 per share. The company will officially report on March 10. For fiscal 2005, Krispy Kreme expects to post earnings of $1.16 to $1.18 per share. It intends to open 120 stores this coming year.

Investors still seemed unconvinced. Krispy Kreme shares were up only about 1% at $37.37 in recent trading, a far cry from the stock's 52-week high of $49.74. However, the comparison between Krispy Kreme and Starbucks(Nasdaq: SBUX) -- and the idea that Krispy Kreme could follow in Starbucks' stellar footsteps -- makes a lot of sense. Both offer an addictive taste of affordable decadence and have targeted aggressive growth, both stateside and internationally.

Alyce Lomax does not own shares of any companies mentioned, though she will say there's nothing like a hot Krispy Kreme doughnut.

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Disney Ends Round One

By Jeff Hwang

Last week, Comcast(NYSE: CMCSA) shocked the world with an unsolicited $54 billion takeover bid for Disney(NYSE: DIS), or about $66 billion including the assumption of debt. As expected, Disney's board of directors unanimously rejected the offer as too low, but left the door open for a higher bid.

Will Comcast bid up?

In a press release, Disney cited that the current offer -- 0.78 Comcast shares for each share of Disney -- works out to $3.60 per share less than where Disney closed on Friday. Yes, this neglects the part where Disney jumped on news of the bid last Wednesday, but then again, Comcast subsequently sold off, which prices the deal even lower at $48 billion.

Comcast responded by saying that its offer "reflects a full and generous valuation" relative to Disney's long-term prospects and represents a premium to Disney's pre-bid share price. Some have expressed concern over whether Comcast can even afford to make an offer that Disney might demand.

In an interesting twist, Disney's board of directors went so far in its latest statement as to express "confidence in the business, financial, and creative direction of Disney under the leadership of Michael Eisner and his management team."

Take that for what it's worth. A guy doesn't attract a date by acting like he needs one, and Disney isn't going to solicit a higher bid by admitting it has management issues. The dance is just getting started. If Comcast really wants Disney, it will find some way to fire back and bid up.

Motley Fool contributor Jeff Hwang owns no shares in either of the aforementioned companies, and can be reached via email by clicking here.