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AT&T to acquire T-Mobile USA for $39 billion

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By Charles Starrett

Contributing Editor
Published: Sunday, March 20, 2011
News Categories: iPhone

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AT&T has announced that it has entered into an agreement with Deutsche Telekom to purchase T-Mobile USA for approximately $39 billion in cash and stock. According to AT&T, the move will allow for a significant expansion of the company’s 4G LTE coverage plans, bringing service to an additional 46.5 million people—including those in rural communities and small towns—and expanding overall deployment to reach 95 percent of the U.S. population. As part of the agreement, Deutsche Telekom will receive an eight percent equity stake in AT&T, and a Deutsche Telekom representative will join AT&T’s board of directors. Notably, the agreement is still subject to regulatory approval.

“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.”

Deutsche Telekom Chairman and CEO René Obermann said, “After evaluating strategic options for T-Mobile USA, I am confident that AT&T is the best partner for our customers, shareholders and the mobile broadband ecosystem. Our common network technology makes this a logical combination and provides an efficient path to gaining the spectrum and network assets needed to provide T-Mobile customers with 4G LTE and the best devices. Also, the transaction returns significant value to Deutsche Telekom shareholders and allows us to retain exposure to the U.S. market.”

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Comments

1

“After evaluating strategic options for T-Mobile USA, I am confident that AT&T is the best partner for our customers, shareholders and the mobile broadband ecosystem.” = “AT&T promised to give us the most money”

Posted by dave on March 20, 2011 at 4:19 PM (PDT)

2

Woow ...that’s interesting ....

Posted by Dennis on March 20, 2011 at 7:04 PM (PDT)

3

Well, I know that my father-in-law won’t be happy as he always seemed to have issues with ATT. I, on the other hand, have no problems. Since T-Mobile is getting out of the North American market does this mean ATT is getting into the European market? Also, is this Ma Bell recreating itself? The govt., broke them apart due to their monopolistic practices. Interesting…

Posted by kevin davis on March 20, 2011 at 8:55 PM (PDT)

4

#3: It’s not a monopoly as long as Verizon, Sprint, and MVNO’s continue to provide mobile phone service.

Posted by Farnsworth on March 21, 2011 at 7:28 AM (PDT)

5

I think this is a fantastic move. Now all of the people that weren’t able to receive service will. In addition, adding more people to the network only makes the network itself stronger. I just don’t see why everyone is freaking out about this. In the long run, this is the best thing that could have happened. Now we will have ONE standard for GSM. I would love to see Verizon buy out Sprint so that we could have ONE standard for CDMA as well.

Posted by Jeffrey Bonacci on March 21, 2011 at 7:43 AM (PDT)

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