AT&T; Offers Free Sale of Small Holders’ Stock

In its earlier identity as nurturing Ma Bell, American Telephone & Telegraph was thought of as the preferred investment of “widows and orphans.” Even now, 22 months after the Bell family was broken up, 1.9 million shareholders--more than half of the company’s 3.2 million total--own fewer than 100 shares each of AT&T; common stock.

But, in order to trim its record-keeping costs, AT&T; said Tuesday that it will offer to help these shareholders cash out their modest investments at no charge. The average stake is 29 shares, worth $623.50 at Tuesday’s $21.50 closing price. A brokerage charge of $30 to $40 would normally be deducted from a sale of that size, according to AT&T.;

“We value very highly the loyalty of all our share owners,” said Virginia A. Dwyer, AT&T; senior vice president-finance. “However, we also recognize that some have continued to keep an account open simply because of the cost or inconvenience associated with selling a small number of shares.”

Would Cut Costs

AT&T; hopes to trim its record-keeping expenses at a time when cost reduction holds a top priority for the company, which now offers long-distance telephone service and a wide range of products and services in the information field. The “widows and orphans” accounts amount to 55 million shares, about 5% of the 1.06 billion shares outstanding, spokesman Dick Gray said.

In addition to keeping each shareholder’s account current and crediting it with dividends as they are declared, the company must make regular mailings to all shareholders, announcing such things as annual meetings and soliciting proxy votes.

If 10% to 20% of eligible shareholders participate, Gray said, the company expects to save $2 million to $3 million.

Eligible shareholders will be mailed details of the offer Oct. 21 and will have until Dec. 17 to participate. Participation is limited to shareholders of record as of Sept. 30. If they do participate, they will receive the Nov. 1 common stock dividend of 30 cents a share declared by AT&T; last Sept. 18.

Authorization Card

The mailing will include a sales-authorization card to be returned to American Transtech in Jacksonville, Fla., an AT&T; subsidiary set up at divestiture to act as transfer agent for the stock of the parent firm and its former siblings.

Each AT&T; shareholder got one share of each of the seven new regional holding companies created at divestiture for each share of AT&T; stock that they held.

The regional firms previously have offered programs to reduce their large number of small accounts. San Francisco-based Pacific Telesis Group announced its second such offer last month through Nov. 1 for shareholders of record as of Aug. 13. That program is limited to holders of fewer than 100 shares and includes a transfer charge of 50 cents a share, with a $5 minimum, spokesman Bill Brittingham said. There are 5.6 million eligible shareholders, he said.

US West, Nynex and Bell Atlantic are participating in the same program.