AT&T Withdraw F.C.C. Merger – AT&T has removed its merger application with T-Mobile USA and the Communications Commission. However, skeptics say that it might be a tactic. The two companies released a joint statement that they still intend to pursue the $39 billion acquisition.
The wireless carrier firms will also prepare for a federal antitrust lawsuit that is seeking to block the deal.
But the companies also said that AT&T planned to take a $4 billion charge against earnings to reflect the potential breakup fees that the company would have to pay Deutsche Telekom if the deal failed to go through.
The actions followed the decision earlier this week by Julius Genachowski, the FCC chairman, that the merger did not meet the commission’s standard for approval. Genachowski sent other commissioners a proposed order to refer the case to an administrative law judge, the first step toward a commission move to block the deal, which would combine the second- and fourth-largest cellphone carriers in the U.S.
The application withdrawal appears in part designed to prevent the FCC from making public AT&T and T-Mobile records about the potential effects of the merger, records that could then be used by the Justice Department in the antitrust trial.
The companies have maintained publicly that the deal would not lessen competition and that it would create jobs in the U.S. But the Justice Department has said that the merger would severely restrict competition, and FCC officials have said that AT&T’s confidential filings indicate the merger would eliminate jobs.
The withdrawal of the FCC application “is a tacit acknowledgment by AT&T that this story is all but over,” said Craig Moffett, an analyst at Sanford C. Bernstein. “The fat lady hasn’t started singing yet, but she’s holding the mic and the band is about to play.”