NEW YORK — AT&T Corp. and Tele-Communications Inc. cleared the last major hurdles Wednesday in their proposed $48-billion merger when the deal won approval from the Federal Communications Commission and shareholders of both companies.
The deal would in effect create one-stop shopping for phone service, Internet access and cable television.
AT&T's planned purchase of TCI, the No. 2 cable television company, is expected to close shortly. The deal has already received Justice Department approval, but still faces scrutiny from a few municipalities and the state of California.
Together, AT&T and TCI will offer long-distance and cellular phone service, cable television and high-speed Internet access. AT&T, the No. 1 U.S. long-distance company, also plans to provide local phone service over TCI's cable TV wires.
Shareholders of New York-based AT&T and Englewood, Colo.-based TCI approved the deal in separate meetings near the companies' headquarters.
The deal will end a quarter of a century of independence for TCI. "It's been a hell of a run," TCI Chairman John Malone told shareholders.
The FCC, meanwhile, approved the deal without requiring the companies to meet certain concessions sought by their rivals. Some Internet companies had urged regulators to require that AT&T and TCI grant open access to their high-speed Internet service to competitors.
AT&T shares fell 50 cents to close at $84.19 on the New York Stock Exchange. TCI shares gained 81 cents to close at $64.31 on Nasdaq. The combined company will trade on the NYSE.
AT&T said about 99% of the shares that were voted approved the merger. More than 72% of the outstanding shares cast a favorable vote, the highest level ever recorded for a company proposal in AT&T's history.
"Our share owners have voted overwhelmingly in support of the AT&T and TCI merger and the benefits it will bring," AT&T Chairman C. Michael Armstrong said.
"The merger is the key to making AT&T the 'any distance' company we need to be and our customers want us to be," he said.
The TCI purchase and proposed joint ventures with other cable companies will allow AT&T to provide local phone service over cable TV wires instead of traditional copper-wire phone networks.
Since the breakup of AT&T and the creation of the Baby Bell local phone companies in 1984, AT&T has lost control of the local phone lines that connect directly into customers' homes and businesses.