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AT&T Kills $39 Billion T-Mobile Offer

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By Douglas A. McIntyre Published
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AT&T (NYSE: T) has ended its quest to buy No.4 US cellular company T-Mobile for $39 billion. It will pay T-Mobile parent Deutsche Telekom a $4 billion break-up fee.

The future of AT&T Wireless will not be significantly altered by the failure. It will continue to lead the US market in share along with Verizon Wireless. The fate of T-Mobile is another matter. It only has 35 million subscribers, and many of those assumed that they would be part of the AT&T network. T-Mobile has not aggressively promoted new services and smartphones based on the assumption that it would be part of AT&T as well.

Deutsche Telekom will now be armed with $4 billion to resurrect T-Mobile. It will have to extend and improve its 4G capacity to compete with its three larger rivals. And, there is speculation that it may buy No.3 cellular carrier Sprint-Nextel (NYSE: S) which continues to struggle. Spint’s share price is down by more than half over the last year. It has 50 million subscribers.

Douglas A. McIntyre

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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