SBC Is Considering Wireless, Global Tracking Stocks

SBC Communications Inc., the largest U.S. local telephone company and the parent of Pacific Bell, is considering creating “tracking” stocks for its wireless and international businesses, Chief Executive Edward Whitacre Jr. said Tuesday.

“It’s a good way to unlock value in some things,” Whitacre said before a speech at Boston College’s Chief Executives Club. He said he is interested to “see what happens with AT&T.;”

AT&T; Corp. is considering selling 10% to 15% of its wireless business, via a tracking stock, to raise about $7 billion, people familiar with the company have said. That could be the largest U.S. initial offering ever.

“All the regional phone companies are studying [tracking stocks] right now, pretty intently,” said Tim Horan, an analyst at CIBC World Markets. “AT&T; will probably announce [one], and that puts pressure on” the regional phone firms.

Tracking stocks for corporate units are controversial because they often confer only token ownership to shareholders while leaving the parent company in total control.

But Wall Street has in some cases applauded the use of tracking stocks to allow investors to set a specific value on a fast-growing business--and to give the parent a currency to use in expanding the unit via acquisitions.

The tracking shares of Sprint Corp.’s wireless unit, for example, have outpaced the growth of the parent company’s stock by more than 4 to 1 this year.

Shares of AT&T; surged from $47 in mid-November to $60 by Monday on tracking-stock rumors. They fell back $4.13 to $55.88 on Tuesday.

Shares of San Antonio-based SBC rose 63 cents to $52.63 on Tuesday.