AT&T bets on long shot to save T-Mobile buyout

According to Bloomberg Businessweek, AT&T is preparing a new remedy proposal to the Justice Department in an attempt to save its troubled $39 billion takeover of T-Mobile. Bloomberg's anonymous source claims that AT&T is considering an offer to divest as much as 40 percent of T-Mobile USA's assets in an attempt to allay the Department of Justice's fears that the merger would lessen competition in the mobile market.

This divestiture would be a larger portion of assets than initially expected from AT&T, and it is not clear what portions of T-Mobile's business AT&T is considering getting rid of. As you'll recall, the Justice Department filed suit to block the deal at the end of August. The merger deal has more recently hit some turbulence amid news that AT&T could take a $4 billion charge if their proposed merger with T-Mobile fails, and the withdrawal of its application for FCC approval of the deal in an attempt to focus more on the Justice Department case. This latest deal proposal hints at a bit of desperation from AT&T's camp.

"If there were a last, best offer to be made, they would have made it a long time ago," Craig Moffett, a Sanford C. Bernstein & Co. analyst in New York, said to Bloomberg Businessweek. "It's very hard to envision a solution that would satisfy the problems the DOJ found with the deal. Realistically, AT&T is going to take its chances in court in February. It's all or nothing."

We'll see if this proposal is enough to convince the DOJ.

Report a problem with article
Previous Story

Next-gen Xbox rumors include two versions and 2013 launch

Next Story

Microsoft's Tellme not the same as Siri, as video explains

9 Comments

Commenting is disabled on this article.

LauRoman said,
So they said the buyout would add jobs... But wouldn't the divestiture basically also get rid of a lot of jobs?

It's all spin. There is no way a takeover of T-Mobile would create jobs.

aboi said,
It's Ma Bell all over again.
AT&T is like the Terminator in T2. Shatter it into a million pices, and it collects all the pieces and molds itself back together given enough time.

“Yesterday AT&T withdrew its application with the FCC for approval of our merger with T-Mobile. We took the required actions, announced this publicly, and filed securities disclosures accordingly. We believe the record will show that we withdrew our merger application before the FCC voted on the chairman's proposed hearing designation order. It has since been reported that the FCC must approve this withdrawal. This is not accurate. The FCC's own rules give us this right and provide that the FCC ‘will' grant any such withdrawal. Further, this has been the FCC's own consistent interpretation of its rules. We have every right to withdraw our merger from the FCC, and the FCC has no right to stop us. Any suggestion the agency might do otherwise would be an abuse of procedure which we would immediately challenge in court.”

http://attpublicpolicy.com/wir...-mobile-merger-application/

Enron said,
“Yesterday AT&T withdrew its application with the FCC for approval of our merger with T-Mobile. We took the required actions, announced this publicly, and filed securities disclosures accordingly. We believe the record will show that we withdrew our merger application before the FCC voted on the chairman's proposed hearing designation order. It has since been reported that the FCC must approve this withdrawal. This is not accurate. The FCC's own rules give us this right and provide that the FCC ‘will' grant any such withdrawal. Further, this has been the FCC's own consistent interpretation of its rules. We have every right to withdraw our merger from the FCC, and the FCC has no right to stop us. Any suggestion the agency might do otherwise would be an abuse of procedure which we would immediately challenge in court.”

http://attpublicpolicy.com/wir...-mobile-merger-application/

And it's all over... for now.

"We'll see if this proposal is enough to {BRIBE|PERSUADE|CONVINCE|SWAY|WOO} the DOJ."

Basically all it's gonna do is show the DOJ that they are desperate. AT&T, if you are reading this... you can lose 6 billion in assets (3B in cash, 3B in spectrum) if this falls through... or you can lose FOURTY PERCENT of T-Mobile... do what the older generations would, and save your money. Give up the 6 Billion over 40% of a company worth (to you) 39 Billion.
Else, you're paying 39 Billion for just 60% of a company.

cybertimber2008 said,
"We'll see if this proposal is enough to {BRIBE|PERSUADE|CONVINCE|SWAY|WOO} the DOJ."

Basically all it's gonna do is show the DOJ that they are desperate. AT&T, if you are reading this... you can lose 6 billion in assets (3B in cash, 3B in spectrum) if this falls through... or you can lose FOURTY PERCENT of T-Mobile... do what the older generations would, and save your money. Give up the 6 Billion over 40% of a company worth (to you) 39 Billion.
Else, you're paying 39 Billion for just 60% of a company.


Which is further proof that it's not about T-Mobile, it's about eliminating a competitor... Plain and simple.