AT&T HAS signalled it is willing to make concessions to secure regulatory approval for its $39 billion (€27 billion) bid to buy Deutsche Telekom’s US mobile phone business.
AT&T’s cash-and-stock bid for T-Mobile USA on Sunday is set to attract intense scrutiny from politicians and competition authorities. Randall Stephenson, AT&T’s chief executive, said he expected the US telecoms company to have to make concessions to regulators.
By buying T-Mobile USA, AT&T would leapfrog Verizon Wireless to become the leading US mobile operator, with an estimated 44 per cent market share by revenue.
The number of large mobile operators would be reduced from four to three, and analysts said regulators could insist on AT&T surrendering radio spectrum.
Mr Stephenson highlighted how AT&T had provided concessions to regulators in previous deals. “I cannot remember a single transaction . . . where we were not asked – and agreed to – some level of concessions. I am not anticipating there will be no concessions required here.”
However, he expressed confidence AT&T would secure regulatory clearance for the acquisition. His optimism is rooted in his claim the deal would help President Barack Obama’s agenda to increase broadband availability.
Mr Stephenson highlighted how, following the transaction, AT&T would expand its new high-speed mobile broadband network to cover 95 per cent of the US population.
Deutsche Telekom’s shares closed up 10.2 per cent while AT&T’s stock was up 1.4 per cent by mid-afternoon. Shares in Sprint Nextel, third in the US and likely biggest loser from the deal, fell 16.2 per cent.
AT&T said the deal would include a $20 billion year-long bridge facility by JPMorgan. According to Dealogic, it is the largest facility of its kind organised by a single bank. – (Copyright The Financial Times Limited 2011)
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