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AT&T Stops T-Mobile Merger Bid With the FCC
An anonymous reader writes Relationships are tough and it looks like AT&T and T-Mobile's has stopped before it even started. From the article: 'AT&T and T-Mobile have announced that they will remove their pending applications to the FCC for their merger bid. This comes after statements from the FCC chairman 'strongly opposing the merger'. In doing so, AT&T has agreed to pay T-Mobile 4 Billion US dollars to cover accounting and other costs that this may have caused. While AT&T would still like to merge, it is unlikely that they will gain antitrust clearance from the Department of Justice. It's the antitrust aspect that this is mostly about, in that AT&T has said that they want this move to free up the FCC to consider all options, and focus both AT&T and T-Mobile on the pending antitrust.'"
Hell just froze over. I am not sure I can sleep tonight.
I expect T-Mobile will still be sold, just not to another major mobile phone provider. I wouldn't be surprised if CenturyLink ends up buying them; they are the largest telecom company without a mobile presence.
There's too many customers and too much spectrum for them to just be shut down. They're even still showing growth, just not as much as AT&T and Verizon (and not as much as Deutsche Telekom would like).
AT&T Stops T-Mobile Merger Bid With the FCC
I didn't even know T-Mobile was trying to merge with the FCC. How did AT&T stop it?
'The tyrant will always find pretext for his tyranny.' - Aesop's Fables
You're just saying that because you haven't seen the "Can you hear me now?" guy in a magenta miniskirt.
Gee, it's almost enough to make you believe that regulators can do their job once in a while. Maybe the FCC can run training seminars for the SEC...
Regardless, it's the right decision. Mergers of this scale are bad for everyone except one of the two CEOs. One guy gets a promotion. Meanwhile customers lose choice, the market loses competition, employees lose jobs (when they become redundant), and shareholders lose their investment (when half get bought out).
And that's before you factor in the (rightly) indignant T-Mobile customers, most of whom have sworn a solemn oath to do business with anyone but AT&T.
The New York Times had an even more informative article on this with the most likely reason -- if they continue with the FCC application, most of the records they filed for it become public, which the DOJ can then turn around and use against them in the antitrust suit. Quite likely, the horrific reality of all of AT&T's patently-false claims that were debunked months ago are spelled out in those filings and they don't want it getting out.
The attempt to withdraw the FCC application is essentially an admission that they know the deal has less than zero chance. Another interesting point in the NYT is that the FCC is under no obligation to honor their request. They can deny it and force it to judicial review, or grant the withdrawal with prejudice (meaning AT&T cannot refile the application later, which would absolutely kill the deal).