AT&T offers wireless stock swap

(Telephony) AT&T has announced plans that will allow common shareholders to trade in their stock for AT&T Wireless Group tracking stock.

For AT&T, the offering begins the process of divesting its ownership of AT&T Wireless, part of the company’s split into four distinct entities.

Following SEC approval, the company said it plans to conduct the swap as soon as possible. While the rate of exchange has not been set, the AT&T said that the trade would be based on approximate market prices of the two stocks, with the probability of a small premium going to AT&T common shareholders to encourage the trade.

While the company is not predicting how much this offering will be utilized, the filing states that up to $10 billion of AT&T Wireless tracking shares will be available. Upon divestiture, the AT&T’s will distribute to its shareholders its remaining interest in AT&T wireless. Currently, only 16% of AT&T Wireless is publicly traded.

When final divestiture does occur, AT&T Wireless tracking stock will be converted into an asset-based common stock.

According to an SEC filing, the offering, “will give holders of AT&T common stock that desire to increase their relative investment in AT&T Wireless Group the opportunity to do so in a convenient manner. Shareholders that have an unrealized gain on their shares of AT&T Common Stock would be able to increase their relative investment in AT&T Wireless Group in a manner generally free of U.S. federal income tax consequences.”