Michael Armstrong: has overseen AT&T shake-up

And it preceded by hours the spin off of AT&T's wireless division in the first stage of a plan which proposes splitting the telecoms giant into four quoted firms, of which AT&T Broadband would also be one.

Comcast claims its offer gives AT&T shareholders "dramatically higher" value than will be achieved under current plans, an assessment agreed on Wall Street, where AT&T shares finished up almost 12% at $18.70.

Shares of Comcast fell 8.4% to close at $39.24 on Nasdaq, amid concerns that buying AT&T Broadband would hurt Comcast's earnings and that such a deal would face intense regulatory scrutiny, analysts said.

End of AT&T?

Comcast's move, nonetheless, came as little surprise to Wall Street analysts, some of whom believe that the offer heralds the demise of the AT&T brand.

"The big question since AT&T announced [its] break-up was which unit was going to be the first to be acquired," said Jeffrey Kagan, an independent telecoms analyst.

"AT&T will cease to exist a year or two from now. All the pieces will be gobbled up and the AT&T brand name will be a nostalgic memory in the history of America business."

Jeffrey Wlodarczak, analyst at CIBC World Markets, said: "I think most people were expecting Comcast to wait until the spin-off was complete and then make a bid.

"It is a little surprising that they felt they needed to move more quickly. Comcast made no secret of the fact that they believed they can run these [AT&T] assets better."

World's biggest

The merger of Comcast with AT&T Broadband would create the world's largest broadband communications company with 22 million subscribers.

AT&T Broadband, already the sector leader in the US, includes cable operations and joint ventures such as the high-speed internet unit Excite@Home.

Any deal is expected to face scrutiny from US competitiveness watchdogs.