AT&T Denies Vodafone Speculation

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AT&T Denies Vodafone Speculation


LONDON-- AT&T Inc. said Monday it doesn't intend to make an offer soon for Vodafone Group PLC, after months of speculation in the telecommunications industry of a potential multibillion-dollar deal.

The U.S. telecommunications giant said it was responding to speculation regarding a potential transaction with the British company after the U.K. Takeover Panel asked AT&T to clarify its position.

Dallas-based AT&T is now restricted from making a takeover bid for Vodafone for six months under U.K. takeover rules. Vodafone's shares fell more than 5% in early London trading.

A European telecommunications executive with knowledge of the matter said there was strong speculation last week that AT&T was continuing to lay regulatory, legal and financial groundwork for a Vodafone bid. "The AT&T statement has further fueled the talk that it plans a bid for Vodafone in the second half of the year," the executive said.

Speculation has focused on a potential bid for Vodafone from AT&T, in part because the U.S. group's chief executive, Randall Stephenson, has expressed interest in pursuing European carriers that would give the company access to markets across the continent, according to people who have heard investor presentations.

Mr. Stephenson is said to have reiterated his interest in broadening investment and operations in Europe at a dinner last Tuesday night with the European Union's top telecom regulator, Neelie Kroes, according to people familiar with the conversation. There was no discussion of specific deals or targets for AT&T, the people said.

Vodafone, the world's second-largest mobile operator after China Mobile, agreed last year to sell its 45% stake in U.S. operator Verizon Wireless to joint-venture partner Verizon Communications Inc. for $130 billion . The sale is scheduled to be completed Feb. 21.

If AT&T were to buy Vodafone, it would get immediate access to major European markets such as the U.K., Germany Spain, Italy and Turkey.

But any move by AT&T in Europe would face intense scrutiny by European regulators after revelations the U.S. spied on European leaders and collected large amounts of data on phone and Internet communications.

AT&T is among the U.S. phone companies that provide calling data to the National Security Agency to feed the far- reaching surveillance programs disclosed by former NSA contractor Edward Snowden, The Wall Street Journal reported last June.

Tapan Panchal contributed to this article.

Write to Costas Paris at costas.paris@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires


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