Even if you have zero interest in following tech and mobile industry news, you’ve almost certainly heard about AT&T’s planned acquisition of T-Mobile. It’s a huge move, essentially cutting down the number of competitors in the national wireless provider space from four to three. If it happens. There are still regulatory hoops that need to be jumped through before the deal is approved, though recent reports suggest that T-Mobile stands to gain quite a bit even if the acquisition doesn’t move forward.
The word is that AT&T has pledged to pay a “break-up fee” to current T-Mobile owner Deutsche Telekom totaling $6 billion in cash and assets. It breaks down as $3 billion in cash, $2 billion worth of spectrum (roughly 10Mhz) and a $1 billion roaming agreement. This comes from Reuters, via two sources who are “familiar with the matter.” Unsurprisingly, AT&T had no comment.
This is all contingent on the deal not happening, of course. Should the acquisition pass regulatory muster, AT&T’s payout to Deutsche Telekom will total $39 billion in cash and stock. Reuters notes that the generous break-up fee being offered is a nod to the confidence AT&T has in this deal receiving the stamp of approval from the United States telecommunications regulator, the Federal Communications Commission and the Department of Justice.
Perhaps the biggest boon to T-Mobile in the $6 billion offer is the chunk of spectrum, which Aircom International consultant Fabricio Martinez estimates to be roughly 10 Mhz, which is the minimum required for high-speed wireless over LTE. The 10 Mhz would roughly double T-Mobile’s current spectrum. Though it’s not the 20 Mhz ideal for LTE services, Martinez figures that the boost would increase current data speeds by one and a half times.
- The best unlimited data plan: Verizon vs. T-Mobile vs. AT&T vs. Sprint
- U.S. lawmakers reportedly pressure AT&T to completely cut ties with Huawei
- Don’t listen to the guy at the mall. How to pick the best smartphone data plan
- T-Mobile keeps adding more customers with low prices and freebies
- 5G is finally coming: AT&T to begin mobile 5G rollout in second half of 2018