For AT&T, Waiting Is the Easiest Part

AT&T hasn’t hung up on its European ambitions, but the carrier may have good reason to wait, if it bids at all for UK-based Vodafone.

AT&T was never anticipated to make a move until after the closure of Verizon Communications' deal to buy the rest of Verizon Wireless from Vodafone. That deal isn't expected to close until Feb. 21, provided Verizon shareholders approve it. In other words, AT&T seemingly had no choice but to say it wasn't interested. According to UK takeover laws, AT&T can't bid for Vodafone for six months, except under certain conditions. These include a bid backed by Vodafone's board, which could be feasible within the six-month time frame. Getting a bid done earlier would help AT&T avoid the risk of interest rates climbing before it raises debt to finance a deal. And delaying has its advantages.

Waiting six months takes AT&T beyond the European parliamentary elections in May, which is also the deadline for a package of telecom-reform measures the European Commission is considering, according to Citigroup. Holding off also likely gets AT&T past a decision by regulators over whether to allow consolidation in the German wireless market, a crucial test case for the European telecom market. If these break in AT&T's favor, it might help boost the rationale for a deal that would come with few apparent synergies.