After a few false starts and stops, Deutsche Telekom has entered into a deal to sell T-Mobile USA to AT&T. The decision has been approved by Boards of Directors at both companies in a transaction that is valued at approximately $39 billion in combination of cash and stock. AT&T will assume no debt from T-Mobile USA, as the company has a strong balance sheet.
The deal provides perhaps the best combination of the companies in the fact that both companies are currently on the GSM platform and both are committed to LTE 4G deployments going forward. The combinations of networks provided significant spectrum which would be an advantage moving forward. AT&T says as a result of this plan it will be able to reach an additional 46.5 million Americans with its 4G LTE deployment meaning that it will have coverage for 95% of the US population. It is estimated that the gain in coverage from T-Mobile USA cell sites would have taken five years to build.
It is estimated that AT&T will gain an additional 33 million customers from T-Mobile USA as part of this transaction. For T-Mobile customers, the transaction will be pretty seamless as both carriers have GSM/UMTS network that is compatible which is the clear advantage in the deal. Current T-Mobile USA customers will enjoy better coverage than they have ever had before.
Published in Mobiles
AT&T to buy T-Mobile USA
by David Stellmack on21 March 2011
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Combination makes the most sense