In an effort to salvage its controversial USD39 billion takeover of T-Mobile USA, AT&T is reportedly considering the divestment of as much as 40% of its Deutsche Telekom (DT)-owned acquisition target. According to Bloomberg, which cites a person familiar with the situation, AT&T’s revised proposal is likely to include the divestiture of a higher share of customers and lower percentage of spectrum than previously mooted. In September Bloomberg reported that AT&T had reached out to MetroPCS, Leap Wireless, CenturyLink, Dish Network and Sprint Nextel, with a view to gauging their interest in buying some of its potential assets.
With a number of significant obstacles standing in its way, AT&T is preparing for a worst case scenario, and has confirmed that it expects to book a pre-tax charge of USD4 billion in 4Q11 for potential break-up fees (USD3 billion in cash, USD1 billion in spectrum), should the long-running deal eventually collapse. As reported by TeleGeography’s CommsUpdate, last week US telecoms regulator the Federal Communications Commission (FCC) signalled it would block the ill-fated deal, prompting AT&T and DT to withdraw their application for FCC approval, and prioritise obtaining approval from the Department of Justice (DoJ), which moved to block the deal in August by filing a civil antitrust lawsuit against AT&T. As previously noted, the DoJ’s case against AT&T is scheduled to commence on 13 February 2012.