Last week, there was a rumor that Sprint and T-Mobile were working on some kind of a merger. Well, it looks like AT&T has already made a move; it just announced that it will acquire T-Mobile USA from Deutsche Telekom for $39 billion in a cash and stock deal.
The AT&T deal was completely unexpected, as it was believed that Deutsche Telekom and Sprint were already in talks regarding a merger or an acquisition by Sprint.
According to the terms of the deal, Deutsche Telekom will receive an 8% ownership interest in AT&T and a board seat. The cash payment of the deal amounts to $25 billion. The deal is still pending regulatory approval, and should close in about 12 months.
The combined entity will have close to 130 million subscribers (AT&T’s 95.5 million and T-Mobile’s 34 million). It will be, by far, the largest mobile provider in the US.
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.
Check out the official press release by AT&T here