AT&T would divest more T-Mobile assets to make merger work
The AT&T/T-Mobile merger has been on the rocks and looked all but dead as of this week, but now Bloomberg is reporting that AT&T may be willing to divest huge amounts of T-Mobile to make sure this merger works. The Department of Justice and FCC have both been investigating the proposed merger, and just two days ago, the carriers withdrew the application from the FCC. It has certainly been a wild ride.
Now, a report from Bloomberg is saying that AT&T is still set on making this merger work, and is willing to sell off as much as 40% of T-Mobile's assets in order to make the deal go through. This does seem like a desperate move by AT&T, because even though selling off more assets could appease the DoJ's concerns that the merger would reduce competition, it is unlikely that the DoJ would allow the T-Mobile assets to be purchased by Verizon. So, AT&T would have to find a way to spread out the sale of assets to other far smaller carriers, which may not have the capital to make the purchases. AT&T has been in talks with MetroPCS and Leap Wireless to sell T-Mobile assets.
There is extra trouble in that AT&T would have to sell a higher proportion of customers and a lower amount of spectrum to make the deal work. Ultimately, it seems that AT&T will just have to focus on fighting the DoJ lawsuit which is scheduled for February.
It is still possible that this deal could go through, but it won't be clean or easy for AT&T.
source: Bloomberg
FCC OKs Cingular\'s purchase of AT&T Wireless
Things that are NOT allowed: