Report: AT&T may not have to pay $6 billion break-up fee if T-Mobile USA acquisition plans fail

AT&T (NYSE:T) may not have to pay Deutsche Telekom the $6 billion break-up fee if regulatory problems cause AT&T's planned $39 billion acquisition of T-Mobile USA, according to a report in Reuters.

As Reuters, citing a person familiar with the deal, reported: "there are a number of options under which the (fee) contract will not come into effect."

The Department of Justice last week initiated a lawsuit to block AT&T's purchase of T-Mobile USA. Part of the deal calls for DT to receive a break-up fee of some $6 billion in cash and other assets if regulators squash the deal. The source, however, said AT&T would only have to pay if certain conditions exist. For instance, the purchase must receive regulatory approval within a designated time frame otherwise the contract is void, according to Reuters' source. In addition, the value of T-Mobile cannot dip below a certain level, which could happen if regulators demand that pieces of T-Mobile be sold as a condition of AT&T's purchase.

For more:
- see this Reuters article

Related articles:
Deutsche Telekom's European investment plans will crumble if AT&T deal fails
Report: AT&T could divest up to 25% of T-Mobile to win approval for deal
Entner: Without AT&T, T-Mobile will be left to a slow death
What does the DOJ's suit mean for the AT&T/T-Mobile deal and beyond?
Department of Justice sues to block AT&T/T-Mobile deal

Suggested Articles

Utilities and others are eager to deploy private wireless networks, and the FCC is making more spectrum available for this purpose.

Verizon is scaling Real Time Kinematics, halfway through a 2-year nationwide network deployment "with a critical mass of major markets" this year.

Application developers will benefit from the efficiency of using Verizon’s distributed network coupled with its fiber footprint and backbone.