AT&T pulls out of T-Mobile acquisition deal
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AT&T will hang up the phone on its embattled bid to take over T-Mobile USA for $39 billion.
The company is calling off the deal, which has hit a series of increasingly serious state and federal roadblocks, and said it would take a $4 billion pre-tax charge as part of its breakup fee to T-Mobile.
In a news release about the end of the deal, AT&T cited the opposition of the Department of Justice and the Federal Communications Commission, which had opposed the deal on the grounds that it would create a less competitive wireless industry and potentially lead to higher prices for consumers.
But AT&T said that the acquisition would have helped the wireless industry, and consumers, by allowing the company to continue building out its network and avoiding what it sees as a coming shortage of wireless airwaves, or spectrum, that companies believe is threatening the industry.
‘The AT&T and T-Mobile USA combination would have offered an interim solution to this spectrum shortage,’ the company said in its statement. ‘In the absence of such steps, customers will be harmed and needed investment will be stifled.’
The deal’s end comes after an uptick in regulatory and legal action against the acquisition. Late last month, AT&T withdrew a crucial clearance application from the FCC, and soon after, the Justice Department argued its case to block the deal on antitrust grounds was no longer necessary, as the deal could only go through with FCC approval.
-- David Sarno