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
Take This Retirement Quiz To Get Matched With An Advisor Now (Sponsored)
Are you ready for retirement? Planning for retirement can be overwhelming, that’s why it could be a good idea to speak to a fiduciary financial advisor about your goals today.
Start by taking this retirement quiz right here from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes. Smart Asset is now matching over 50,000 people a month.
Click here now to get started.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
