AT&T Wireless 2009 Annual Report Download - page 71

AT&T 09 AR 69
finalizing definitive agreements and seeking regulatory
approvals to sell all eight Centennial service areas ultimately
identified in that ruling. We anticipate we will close the sales
during the first half of 2010. As of December 31, 2009, the
fair value of the assets subject to the sale, net of related
liabilities, was $282. These net assets include property, plant
and equipment, spectrum licenses, customer lists and other
intangible assets, and working capital, which are not deemed
material for isolated presentation as assets held for sale and
liabilities related to assets held for sale in our consolidated
balance sheet as of December 31, 2009, and we included
these net assets in our Other current assets balance.
Dobson In November 2007, we acquired Dobson for
approximately $2,500. Under the purchase method of
accounting, the transaction was valued, for accounting
purposes, at $2,580. Our December 31, 2007 consolidated
balance sheet included the preliminary valuation of the fair
value of Dobson’s assets and liabilities, including goodwill
of $2,623, FCC licenses of $2,230, customer lists of $517
and other intangible assets totaling $8 associated with this
transaction. Final adjustments to the preliminary valuation
included an increase to goodwill of $990, a decrease in
licenses of $781 and a decrease in customer lists of $12.
The resulting balances are $3,613 for goodwill, $1,449 for
licenses and $505 for customer lists. Adjustments were
primarily related to changes in the valuation of certain
licenses and an increase in the estimate of relative obso-
lescence of property, plant and equipment resulting in a
decrease in value and shorter average remaining economic
life, and an adjustment to the value of the markets included
in the divestiture order by the FCC. Pursuant to the order,
we exchanged certain properties, spectrum and $355 in cash
for other licenses and properties. Deferred tax adjustments
are associated with the above mentioned items. Dobson
marketed wireless services under the Cellular One brand and
had provided roaming services to AT&T subsidiaries since
1990. Dobson had 1.7 million subscribers across 17 states.
Dobson’s operations were incorporated into our wireless
operations following the date of acquisition.
Other Acquisitions During 2009, we acquired a provider
of mobile application solutions and a security consulting
business for a combined $50 before closing costs. The fair
value of the acquired businesses’ net assets resulted in the
recognition of $41 of goodwill and $3 in customer lists and
other intangible assets.
During 2008, we acquired Easterbrooke Cellular
Corporation, Windstream Wireless, Wayport Inc. and the
remaining 64% of Edge Wireless for a combined $663,
recording $449 in goodwill. The acquisitions of these
companies are designed to expand our wireless and
Wi-Fi coverage area.
During 2007, we acquired Interwise®, a global provider of
voice, Web and video conferencing services to businesses,
for $122 and Ingenio®, a provider of Pay Per Call® technology
for directory and local search business, for $195, net of cash.
We recorded $304 of goodwill related to these acquisitions.
Dispositions
In 2009, we sold a professional services business for $174
and eliminated $113 of goodwill.
In April 2008, we sold to Local Insight Regatta Holdings,
Inc., the parent company of Local Insight Yellow Pages, the
Independent Line of Business segment of the L.M. Berry
Company for $230.
In May 2007, we sold to Clearwire Corporation (Clearwire),
a national provider of wireless broadband Internet access,
education broadband service spectrum and broadband radio
service spectrum valued at $300. Sale of this spectrum was
required as a condition to the approval of our acquisition
of BellSouth.
Other Adjustments
As ATTC and BellSouth stock options that were converted
at the time of the respective acquisitions are exercised, the
tax effect on those options may further reduce goodwill.
During 2008, we recorded $1 in related goodwill reductions
for ATTC and $9 for BellSouth.
NOTE 3. EARNINGS PER SHARE
A reconciliation of the numerators and denominators of basic
earnings per share and diluted earnings per share for
income from continuing operations for the years ended
December31,2009, 2008 and 2007, are shown in the
table below:
Year Ended December 31, 2009 2008 2007
Numerators
Numerator for basic earnings
per share:
Net income attributable
to AT&T $12,535 $12,867 $11,951
Dilutive potential common shares:
Other share-based payment 10 9 8
Numerator for diluted
earnings per share $12,545 $12,876 $11,959
Denominators (000,000)
Denominator for basic earnings
per share:
Weighted-average number
of common shares outstanding 5,900 5,927 6,127
Dilutive potential common shares:
Stock options 3 9 24
Other share-based payment 21 22 19
Denominator for diluted
earnings per share 5,924 5,958 6,170
Basic earnings per share $ 2.12 $ 2.17 $ 1.95
Diluted earnings per share $ 2.12 $ 2.16 $ 1.94