In a surprising move today, AT&T has announced they will withdraw their application to the Federal Communications Commission to acquire T-Mobile USA. Their reasoning is they want to instead focus on the proposed anti-trust suit brought by the US Department of Justice. Ma Bell has decided to focus on the potential suit considering the FCC decided to hold a hearing earlier this week regarding the intended purchase. Also stated is AT&T expecting to recognize a $4 billion pre-tax in the 4th quarter of 2011 which will reflect a potential breakup fee paid in cash and book value in spectrum to Deustche Telekom should the deal fall through. Hit the break for the full presser from Ma Bell.
“AT&T and Deutsche Telekom Continue to Pursue Sale of DT’s U.S. Wireless Assets
Companies Withdraw FCC Applications; AT&T Expects to Recognize $4 Billion Charge; Companies Focus on Gaining DOJ Approval
On Nov. 22, 2011, the Federal Communications Commission indicated a proposed order was circulating that would designate for hearing the applications of AT&T Inc. and Deutsche Telekom AG For Consent To Assign or Transfer Control of Licenses and Authorizations, WT Docket No. 11-65. On November 23, 2011, AT&T Inc. and Deutsche Telekom AG electronically withdrew without prejudice, as of that date, the pending applications listed in the Public Notice released by the Federal Communications Commission on April 28, 2011 in that proceeding. Associated manual notification of withdrawal filings also are being mad
AT&T Inc. and Deutsche Telekom AG are continuing to pursue the sale of Deutsche Telekom’s U.S. wireless assets to AT&T and are taking this step to facilitate the consideration of all options at the FCC and to focus their continuing efforts on obtaining antitrust clearance for the transaction from the Department of Justice either through the litigation pending before the United States District Court for the District of Columbia, Case No. 1:11-cv-01560 (ESH) or alternate means. As soon as practical, AT&T Inc. and Deutsche Telekom AG intend to seek the necessary FCC approval.
As a result of the FCC’s action, AT&T expects to recognize a pretax accounting charge of $4 billion ($3 billion cash and $1 billion book value of spectrum) in the 4th quarter of 2011 to reflect the potential break up fees due Deutsche Telekom in the event the transaction does not receive regulatory approval.”