AT&T/T-Mobile merger approval would come at a price

Author: 
Coverage Type: 

If the AT&T Inc. acquisition of T-Mobile USA is approved, expect a laundry list of conditions. And don't count on LightSquared Inc.’s interference issues to resolve themselves by the end of the year.

These were just some of the observations Citadel Securities analysts made after the group hosted a recent series of meetings with investors and key telecommunications stakeholders in Washington. Citadel analyst Shing Yen released a summary of the observations Friday. Earlier this month, Yen predicted Apple would select Sprint Nextel to carry the iPhone by the end of 2011. Among those who attended the meetings were: Jeffrey Carlisle, executive vice president of regulatory affairs for LightSquared; Thomas Tauke, executive vice president of public affairs for Verizon Wireless; U.S. Sen. John Kerry (D-MA); a handful of Federal Communications Commission officials and others. In the analyst summary, Yen wrote that “hurdles may be higher than previously thought” on AT&T’s proposed purchase of T-Mobile, which Sprint vehemently opposes. But if it were approved, Yen said, regulators would consider the most likely acquirers of divested assets, but it isn't clear if sufficient credible buyers exist. “Even if AT&T is willing to accept onerous conditions, we believe the prospect of increased regulatory oversight could cause other industry players — most notably Verizon — to object,” Yen wrote. “Both FCC and (the U.S. Department of Justice) want to ensure that T-Mobile isn't weakened by a prolonged review.”


AT&T/T-Mobile merger approval would come at a price