AT&T announced last week that it would take a $4 billion charge if its plans to takeover T-Mobile fall apart. The announcement indicates the U.S. telecom giant recognizes that pressure from regulators is seriously harming its chances for approval of the deal. The company also has withdrawn its application to industry regulators.
"AT&T Inc. and Deutsche Telekom AG are continuing to pursue the sale of Deutsche Telekom's U.S. wireless assets to AT&T," both companies said in a Nov. 24 statement.
In March, AT&T announced it had reached a $39 billion deal to acquire T-Mobile, which is owned by Germany-based Deutsche Telekom AG. In August, the Department of Justice filed suit to block the deal, citing antitrust violations.
“The combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for mobile wireless services,” Deputy Attorney General James M. Cole said in a. Aug. 31 press release. “Consumers across the country, including those in rural areas and those with lower incomes, benefit from competition among the nation’s wireless carriers, particularly the four remaining national carriers. This lawsuit seeks to ensure that everyone can continue to receive the benefits of that competition.”
The Federal Communications Commission—which also opposes the deal, claiming in a recent statement that it would “result in a massive loss of U.S. jobs and investment”—must approve the withdrawal of the application, as well as determine if and how the companies could resubmit an amended request.