Vodafone matches Cingular for AT&T
From CNN Correspondent Fred Katayama
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Vodafone's bid could face more difficulties than Cingular's.
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NEW YORK (CNN) -- Britain's Vodafone has raised its bid for AT&T Wireless to $38 billion, or $14 a share, to match a bid by Atlanta-based Cingular Wireless, according to a source close to what has become a bidding war for the third largest U.S. wireless carrier.
Initial bids were reportedly worth some $3 billion less.
The board of AT&T Wireless was meeting Monday to assess the competing bids, said sources familiar with the situation.
None of the companies would comment officially on the bids.
"It's a highly fluid situation. It's very competitive. There's a lot of back and forth," said one source.
Analysts say a combination between Cingular and AT&T Wireless makes more sense because the two have overlapping infrastructure, which would allow them to cut costs.
Vodafone, in order to do a deal, would need to free itself from its joint venture stake in Verizon Wireless.
Cingular is the second-largest cell phone group in the U.S. and is by SBC Communications and BellSouth.
Sources familiar with talks told Reuters on Sunday that AT&T Wireless, which put itself up for sale on January 22 after a series of lackluster results, asked Vodafone and Cingular for sweetened offers after both groups bid roughly $35 billion.
The auction for the third-ranked U.S. mobile phone group signals the start of long-awaited mergers in the fiercely-competitive U.S. mobile industry, in which six national brands and a handful of regional players are battling for market share.
"We do see Vodafone as a serious bidder now, but we still see Cingular in the driving seat," one analyst told Reuters.
"They have more shareholder support and stand to get more synergies."
AT&T Wireless, which is 16 percent-owned by Japan's giant NTT DoCoMo, has debt of around $5.9 billion.
