If AT&T deal fails, T-Mobile has no plan B

Posted by Raven Lovecraft

As the US Department of Justice prepares to sue to block AT&T's takeover of T-Mobile, the question now becomes "what if the deal fails?"

Apparently no one is ready to answer that question. T-Mobile does not have a set strategy on what to do if the proposed AT&T buyout does not gain regulatory approval.

Although there are multiple major cell phone carriers in the US, T-Mobile and AT&T are the only ones that use the international GSM standard. The two of them combining into one company would result in the largest mobile provider by far and could present a monopoly risk.

T-Mobile parent company Deutsche Telekom still has faith that the deal will go through.

Bloomberg quoted Deutsche Telekom supervisory board member Jan van Damme at this week's IFA trade show in Berlin as saying, "Other scenarios were not being discussed. When you are in a deal, you stick to that deal, a clear focus on that deal."

You can bet that people are sweating behind the scenes, but in the public eye neither company appears nervous. "When it comes to larger [merger and acquisition] deals in the US, these things happen. This isn’t an exception ... we have everything under control," said van Damme.

Regardless, someone was thinking of the possibility of a deal collapse when the papers were signed, because the acquisition terms state that AT&T will still hand over a sizable chunk of money to T-Mobile if the government blocks the acquisition.