Christine Varney, the Department of Justice's antitrust chief, will resign her post next month while the department is in the middle of its review of AT&T's (NYSE:T) proposed $39 billion purchase of T-Mobile USA. While it's unclear what impact her departure will have on the fate of the acquisition, Varney herself indicated that she does not think much will change.
Varney, 55, will resign effective Aug. 5 to join the law firm Cravath, Swaine & Moore as a partner. Varney has been viewed as a tough and shrewd antitrust chief who has reinvigorated the division at the Justice Department since President Obama took office. She has taken a tough stance on several major cases, even though some mega-mergers have been approved, including Comcast's purchase of NBC-Universal. According to the Wall Street Journal, an interim successor from inside the department is expected to be named to replace Varney.
In an interview with the Journal, Varney said ongoing cases, including the AT&T/T-Mobile deal, will not be impacted by her departure. "I think the matters that are pending are going to receive the same level of attention," she said. "I don't foresee any disruption whatsoever." In a separate interview with Bloomberg she used similar language to describe the situation, and said a "strong team" will continue the review.
Both the Justice Department and the FCC must approve the deal, which AT&T and T-Mobile said they expect to close early next year.
Rebecca Arbogast, an analyst at Stifel Nicolaus, said it is impossible for anyone outside the department to assess with any confidence what Varney's departure will mean for the deal. "As a general matter, an acting person will be a little less bold," Arbogast told FierceWireless. "It's also probably more likely that AT&T can seize any period of instability and use it to their advantage compared to their opponents."
Sprint Nextel (NYSE:S), the most outspoken opponent of the AT&T/T-Mobile deal, thanked Varney for her work and said in a statement that it had confidence that the antitrust staff and Varney's successor will block the deal.
- see this WSJ article (sub. req.)
- see this Bloomberg article
- see this NYT article
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