Feds Move To Block AT&T, T-Mobile Merger

By Kyle Alspach and Eric Convey , Boston Business Journal

BOSTON (CBS) – The U.S. Department of Justice moved Wednesday to block the planned merger of AT&T and T-Mobile, filing an antitrust lawsuit in federal court.

AT&T shares fell $1.58, or 5.3 percent, to $28.04 shortly after the DOJ’s suit was announced at about 11 a.m.

In a statement Wednesday, AT&T general counsel Wayne Watts said the company is “surprised and disappointed” by the action, saying that during repeated meetings, “there was no indication from the DOJ that this action was being contemplated.”

“We remain confident that this merger is in the best interest of consumers and our country, and the facts will prevail in court,” the statement said.

T-Mobile is owned by Deutsche Telekom.

Should the government prevail in preventing the deal, the most significant commercial impact in Massachusetts most likely would be the inability of a combined company to consolidate hundreds of retail operations.

There could also be ramifications for telecom-related companies such as Boston-based American Tower Corp.

Lisa van der Pool of the Boston Business Journal reports

AT&T and T-Mobile both lease antenna space from American Tower; the companies share antenna space on approximately 3,100 of the company’s wireless towers, American Tower said previously.

Those leases accounted for 4 percent of American Tower’s revenue at the end of 2010.

Fears have also been raised that the combination of the two wireless giants would affect demand for new towers.

Shares in American Tower were up 2 percent at noon on Wednesday.

  • fred

    There is no basis for the DOJ’s refusal to allow the merger. There is plenty of competition and innovation will continue in this industry. T-mobile is supposidly moving offshore jobs to the US if the merger is allowed. Perhaps the DNC (and Obama) is looking for campaign donations first before they allow it to go through.

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