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AT&T backpedals on T-Mobile buyout

AT&T ( T ) has withdrawn (temporarily, it says) its bid for the Deutsche Telekom-owned T-Mobile, putting a hole beneath the waterline of its efforts to become the largest mobile carrier in the U.S.

"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," AT&T said in a press release which dropped into the news hole on November 24.

The Federal Communications Commission threw a serious obstacle in the path of the proposed $39 billion merger last week when it decided to put the deal under the scrutiny of further review in 2012, as the Wall Street Journal reported.

If the deal does fall through, AT&T will be on the hook for $3 billion in cash and another $3 billion in assets, including part of its wireless spectrum. This penalty was an integral part of the deal with Deutsche Telekom - basically an insurance policy to ensure T-Mobile's survival if the deal collapsed. The deal will need to be completed by September 20 for AT&T to avoid paying out.

That's looking like an increasingly credible possibility, since success for the mobile giant now means overcoming a Department of Justice antitrust lawsuit, legal review from the FCC and shareholder skepticism combined.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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