AT&T Walks Away From Merger With T-Mobile – For Now
Some huge news shook the wireless industry over Thanksgiving weekend with the announcement that AT&T has formally withdrawn their bid to the FCC to acquire T-Mobile for $39 billion. Before you get your hopes up — T-Mobile’s parent company, Deutsche Telekom, said that although they have withdrawn their application to the Federal Communications Commission, they will continue to pursue anti-trust approval for the proposed merger from the U.S. Department of Justice.
So, why the withdraw in the first place? Some are speculating that it’s very possible AT&T didn’t want to fight 2 court battles simultaneously and they’ll be back once they get things worked out with the DOJ in February. One thing is for certain, AT&T better start counting out the $4 billion ($3 billion in cash and $1 billion for spectrum access) they now owe T-Mobile as part of the “breakup fee” in the event the transaction didn’t go through as planned.
Some are speculating that even with the new $4 billion in pocket change, this is only postponing the inevitable for T-Mobile and bankruptcy is in their very near future. Don’t worry, Carly — you always have a home here with me… in my parent’s basement.
[Via Reuters]