US government files to block proposed AT&T / T-Mobile merger

You heard right. Bloomberg is reporting that the United States government (!) just filed court papers in Washington, D.C. to block the much ballyhooed tie-up between AT&T and T-Mobile USA. Oddly enough, T-Mobile and AT&T promised this morning that a total of 5,000 jobs would be hand delivered to the US if the two telcos were allowed to become one, but it'll take a heck of a lot more convincing now. For what it's worth, this doesn't mean that the deal is or isn't happening -- it's just another step in the process -- but it most certainly doesn't bode well for proponents. Nor for AT&T's share price.

According to the report, the Justice Department feels that the deal would "substantially lessen competition" in the wireless space. In fact, it boldly stated the following: "AT&T's elimination of T-Mobile as an independent, low-priced rival would remove a significant competitive force from the market." If things end up falling apart, it's important to remember that AT&T would be forced to pay Deutsche Telekom $3 billion as a break-up fee, which ought to make Tiger Woods' misfortunes look like an outright bargain.

[Thanks to everyone who sent this in]

US government files to block proposed AT&T / T-Mobile merger originally appeared on Engadget on Wed, 31 Aug 2011 10:36:00 EDT. Please see our terms for use of feeds.

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Source: http://www.engadget.com/2011/08/31/us-government-files-to-block-propsed-atandt-t-mobile-merger/

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