AT&T to buy T-mobile in potential largest deal of year
In a deal that would make AT&T the undisputed number one wireless company in the U.S., overtaking Verizon Wireless in numbers of customers, the company has announced a $39 billion deal to buy T-Mobile USA, currently owned by Deutsche Telekom AG, according to Bloomberg.
Stocks for AT&T have surged with the announcement which is still subject to government regulatory approval, a process that could last as long as one year, according to the news source. AT&T and T-Mobile are both current wireless giants, with the latter as the number four provider of mobile service. A buy-out would pose questions of sufficient competition in the market.
AT&T's chief executive officer, Randall Stephenson, was very confident in the regulatory outcome.
“We studied this thing extensively over the last few months and we’re very confident it will be approved. Most local markets have a choice between five carriers, so the space will remain fiercely competitive,” Stephenson told the news outlet.
Some disagree and believe that the 34 million customers that AT&T stands to gain pose sufficient regulatory concern.
“It’s difficult to come up with any justification or benefits from letting AT&T swallow up one of its few major competitors. AT&T is already a giant in the wireless marketplace, where customers routinely complain about hidden charges and other anti-consumer practices," Parul P. Desai, policy counsel for Consumers Union, wrote to the news source.
"We plan to work very closely with regulators and lawmakers to carefully scrutinize this deal and what it would mean to people's pocketbooks," added Desai, according to the Consumerist.com.
The AT&T and T-Mobile USA deal, if successful, would likely be the biggest deal in 2011, according to Fox News. The merger would raise AT&T revenues to nearly one third more than Verizon.