AT&T Buys T-Mobile
Dallas, TX and Bonn, Germany-- AT&T and Deutsche Telekom announced Sunday, a tentative agreement for AT&T to purchase T-Mobile U.S.A. from Deutsche Telekom for a cash-and-stock valuation of around $39 Billion.
AT&T says the acquisition of T-Mobile USA provides an "optimal combination of network assets to add capacity sooner than any alternative, and it provides an opportunity to improve network quality in the near term for both companies’ customers. In addition, it provides a fast, efficient and certain solution to the impending exhaustion of wireless spectrum in some markets, which limits both companies’ ability to meet the ongoing explosive demand for mobile broadband."
Additionally. AT&T says they can now cover an additional 46.5 million Americans beyond current plans – including rural communities and small towns.
“This transaction represents a major commitment to strengthen and expand critical infrastructure for our nation’s future,” said Randall Stephenson, AT&T Chairman and CEO. “It will improve network quality, and it will bring advanced LTE capabilities to more than 294 million people. Mobile broadband networks drive economic opportunity everywhere, and they enable the expanding high-tech ecosystem that includes device makers, cloud and content providers, app developers, customers, and more. During the past few years, America’s high-tech industry has delivered innovation at unprecedented speed, and this combination will accelerate its continued growth.”
AT&T will pay $25 billion in cash and complete the transaction with the balance in common stock, reserving the right to increase the purchase price by an additional $4.2 Billion.
The acquisition is subject to regulatory approvals, a reverse breakup fee in certain circumstances, and other customary regulatory and other closing conditions. The transaction is expected to close in approximately 12 months.