It’s getting more likely that a deal that would let AT&T purchase T-Mobile USA is going forward, even with regulatory concerns.
Word came this week from The Wall Street Journal that AT&T has employed bankers for advice on selling assets.
The assets up for sale are likely customers and spectrum.
The federal government needs to give its approval for AT&T to go through with the purchase of the other company.
The deal had a price tag of $39 billion.
Now with the latest news, CNET is reporting that the deal may cost more than was thought.
CNET says that the assets may be worth more than $8 billion.
"As we said on the day we announced the merger with T-Mobile USA, we anticipate there will be some divestitures, as we have had in past mergers, but any speculation about the amount of divestitures is premature," a company representative told CNET.
The bank being used by AT&T was identified by The Journal as Bank of America Merrill Lynch.
The deal may be approved sometime during the first quarter of 2012, CNET speculates.
It is expected that AT&T will have to make some “concessions” for the deal to go through, according to media reports.
In a review of the proposed deal, TechZone360’s Gary Kim is reporting that the deal would increase market concentration, lessen consumer choice, and allow for price increases in the U.S. wireless markets, citing conclusions from Gigi Wang, Yankee Group chief research officer, and Carl Howe, Yankee Group director.
The analysts, Kim said, have put “cold water on the merger’s promise of benefiting consumers and competition.”
The analysts say that the deal could result in higher prices and less choice, Kim said.
AT&T and Verizon both had about a third of all U.S. mobile subscribers as of March 2011, TechZone360 said.
AT&T had 97.5 million customers, which is about 32 percent market share, and Verizon had 95 million customers, which is about 31 percent share, TechZone360 said.
Ed Silverstein is a TechZone360 contributor. To read more of his articles, please visit his columnist page.Edited by
Rich Steeves