Saudis Select AT&T; to Put Together New System

AT&T; Corp. won a $4-billion, seven-year agreement to build an advanced digital communications network in Saudi Arabia, the company said Monday.

AT&T; beat several rivals for the deal, including Northern Telecom Ltd., Siemens and L.M. Ericsson Telephone Co. Terms must still be finalized, but through 2000 the deal could add annual sales of about $600 million to the company, which had revenue last year of $65 billion.

Last month, President Clinton sent a letter to Saudi King Fahd that urged AT&T; be chosen. Secretary of State Warren Christopher mentioned it in a visit to the king.

“We are delighted that AT&T; was selected to partner with the Saudis in their telecommunications expansion project,” AT&T; Chairman Robert E. Allen said in a statement. He also thanked Clinton.

The AT&T; executive in charge of the bid, Dan Hesse, said the company’s rivals received similar support from their governments.

“With government procurement, support from the suppliers’ government is always an important factor,” Hesse, president of AT&T; Network Systems International, said by phone from the Netherlands.

Commerce Secretary Ronald H. Brown, who has made two trips to Saudi Arabia in the past year, issued a statement saying the contract had “commanded top priority” at his department for the past eight months.

The contract is to double Saudi Arabia’s existing communications system capacity by the year 2000, creating 1.5 million digital lines as well as wireless systems.