AT&T CEO reiterates interest in Europe, but Verizon steers clear

AT&T CEO Randall Stephenson said the U.S. operator is still interested in buying mobile operator assets in Europe, although the company continues to keep the market guessing about its actual targets.


Speaking at the Goldman Sachs Communacopia conference this week, Stephenson would not reveal any further details other than to say AT&T would welcome significant deals at the right price, according to the Wall Street Journal. "If there were opportunities that presented a good value, of course we would do it," he said.

While it's nothing new that AT&T has been keeping an eye on potential European deals, with speculation that EE of the UK and even Vodafone could be among its targets, the Journal noted that the timing of Stephenson's comments is notable in view of Vodafone's recent deal to sell its stake in Verizon Wireless for $130 billion.

Verizon Communications sold $49 billion in bonds two weeks ago to fund its deal with Vodafone, and Stephenson described the bond offering as "eye opening," according to the Journal.

"It allows you to think differently about things," he said. "Different than you might have thought three weeks ago."

AT&T has limited options to expand on its home market, leaving Europe as a potentially interesting area for further growth. However, there are risks as well as opportunities in the region. Stephenson said Europe is behind the U.S. in terms of mobile broadband investment, and raised concerns about regulatory aspects such as spectrum licences, which are usually issued with an indefinite term in the U.S. but are mainly limited to 10-12 years across most countries in Europe.

Meanwhile Verizon has ruled out an expansion into Europe. According to the Wall Street Journal, Verizon CEO Lowell McAdam said at the Goldman Sachs conference that Verizon considered merging with Vodafone but decided against it because it believed it could rely on growth in the U.S. market.

"If you looked at the next five years, the growth prospects for us in the U.S. so outweighed the prospects for Europe," McAdam said, according to the Journal. "I could not make a strong case for the Verizon shareholder that it was better to merge than it was to go more aggressively in the United States."

For more:
- see this WSJ article (sub. req.)
- see this Reuters article

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