AT&T (T), T-Mobile Deal Nearly Down the Toilet Following FCC Decision
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Amid failure to receive FCC approval, AT&T (NYSE: T) and Deutsche Telekom (OTCBB: DTEGY), the parent company of T-Mobile, are rumored to have suspended talks in the proposed $39 billion T-Mobile deal. Still, the two plan to push ahead for a deal sometime in the future.
Deutsche Telekom, late Wednesday, filed a request for the FCC to dismiss the merger applications without prejudice. This means that Deutsche Telekom and AT&T would be able to refile an amended application at anytime, should talks continue.
Politico has pointed out the FCC's three options moving forward:
An FCC decision may come within the next several days.
Some speculate the move will position AT&T and Deutsche Telekom to mold the M&A plan in a fashion which raises less antitrust issues, and therefore gains favor with the U.S. Department of Justice. AT&T could also want to block the release of its findings from the merger review.
With the new call by the FCC, some analysts moved the chances of this deal closing from 25 percent ahead of the decision to now just 10 percent.
Late Wednesday, AT&T said it would take a $4 billion charge in the fourth quarter to help offset a potential $7 billion breakup fee should the deal not go through.
Shares of AT&T are down about 0.4 percent ahead of Friday's opening bell.
Deutsche Telekom, late Wednesday, filed a request for the FCC to dismiss the merger applications without prejudice. This means that Deutsche Telekom and AT&T would be able to refile an amended application at anytime, should talks continue.
Politico has pointed out the FCC's three options moving forward:
- allow the withdrawal of applications without prejudice;
- applications may be withdrawn with prejudice; and
- the case can be sent to an administrative judge, who could deny the companies' request.
An FCC decision may come within the next several days.
Some speculate the move will position AT&T and Deutsche Telekom to mold the M&A plan in a fashion which raises less antitrust issues, and therefore gains favor with the U.S. Department of Justice. AT&T could also want to block the release of its findings from the merger review.
With the new call by the FCC, some analysts moved the chances of this deal closing from 25 percent ahead of the decision to now just 10 percent.
Late Wednesday, AT&T said it would take a $4 billion charge in the fourth quarter to help offset a potential $7 billion breakup fee should the deal not go through.
Shares of AT&T are down about 0.4 percent ahead of Friday's opening bell.
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