We conclude that at this particular time, acquisition of Kmart would not be the most feasible endeavor for AT&T since they are in financial difficulties themselves. They should wait until AT&T becomes a company to be reckoned with and then go for the kill. It is in our opinion that if AT&T does try to acquire Kmart right now, it may cause irrevocable damage like a drown man trying to save another drowning man. The financial analysis shown in tables A and B illustrates the lack of net income and the ramifications of an acquisition. The numbers themselves say that AT&T is not in the position to successfully complete this acquisition. The question then rises, why doesn't AT&T merge with MCI? Sprint? Verizon? This delves into corporal issues such as monopolies and besides, merging with Sprint or Verizon would be more like an acquisition of AT&T. This would not be the best interest for AT&T.
We recommend that AT&T continues to diversify that will aid them to become a strong company once again. They should fashion themselves to Phillip Morris Company. If Phillip Morris had not spread their products beyond the tobacco industry, they would have had to deal with the impact of the decline in the tobacco industry even more so than they did at that time. They had a safety net and so should AT&T. We hope that we have shed some light on issues pertaining to the possible acquisition of Kmart in terms of effects on their finances, their operations, and overall value. With this, we wish AT&T the best of luck with their decision whether to implement our suggestions and findings.