AT&T drops blocked bid for T-Mobile in US

AT&T has abandoned its $39-billion (€30-billion) deal to buy Deutsche Telekom's US wireless unit T-Mobile after running into stiff opposition from American regulators.

AT&T drops blocked bid for T-Mobile in US
Photo: DPA

AT&T said it would have to take a $4 billion charge for dropping the offer, first made in March, to purchase T-Mobile USA.

The move came after the Federal Communications Commission said the takeover would reduce competition across the country in the already thinly-populated cellphone provider industry, and the Justice Department sued to block the deal on anti-competitive grounds.

The end of the deal leaves AT&T in second place in the US industry and several billion dollars poorer: in its original contract with Deutsche Telekom, it promised to pay the German company $3 billion in cash if the deal fell through.

In addition, Deutsche Telekom said in a statement, AT&T has to provide T-Mobile USA a long-term deal on 3G roaming services and a “large package” of mobile communications licenses.

But Telekom shares were still down almost two percent at €8.75 in Frankfurt trading on Tuesday morning.

“It is incomprehensible to block a transaction which would have helped the United States to fulfil its objectives” of developing its wireless business, a miffed Deutsche Telekom CEO Rene Obermann told reporters on Tuesday.

The news also effectively scotched AT&T’s hopes of leapfrogging industry leader Verizon into first place, boosted by the acquisition of fourth-runner T-Mobile’s subscribers.

It left AT&T lagging Verizon in the race to expand its holdings of telecoms spectrum necessary to build new 4-G cellphone standard networks, which will better accommodate high-volume data and streaming services that more and more consumers want.

While AT&T will now not acquire T-Mobile’s airwaves, at the beginning of December Verizon inked a deal to spend $3.6 billion to buy wireless spectrum from three leading cable providers.

Clearly frustrated by the government’s opposition, AT&T said in a statement that giving up the deal meant that cellphone users would continue to face a shortage of airwaves.

The US wireless industry “is one of the most fiercely competitive industries in the world, with a mounting need for more spectrum that has not diminished and must be addressed immediately,” the company said.

“The AT&T and T-Mobile USA combination would have offered an interim solution to this spectrum shortage. In the absence of such steps, customers will be harmed and needed investment will be stifled.”

Both the Justice Department and the FCC had strenuously opposed the deal. In a long review the FCC concluded that competition would have been significantly cut in 99 of the top 100 US wireless markets. T-Mobile was not present in one of those markets.

AT&T last week suggested it was seeking to alter the deal to see if it could find some way to meet government objections, but in the end appeared unable to find another way forward.

AT&T chairman and chief executive Randall Stephenson said in a statement that the company would continue to invest to improve and expand its network.

“However, adding capacity to meet these needs will require policymakers to do two things. First, in the near term, they should allow the free markets to work so that additional spectrum is available to meet the immediate needs of the US wireless industry.” “Second, policymakers should enact legislation to meet our nations longer-term spectrum needs.”

But the Justice Department defended its opposition to the deal.

“This result is a victory for the millions of Americans who use mobile wireless telecommunications services,” deputy attorney general James Cole said in a statement.

“A significant competitor remains in the marketplace and consumers will benefit from a quick resolution of this matter without the unnecessary expense of taxpayer money and government resources.”


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Travel: Germany downgrades Covid-19 risk status of USA

The United States is no longer classed as a "high incidence area" by Germany - it has returned to being a "risk area".

Travel: Germany downgrades Covid-19 risk status of USA
People walking in New York in May 2020. Photo: DPA

The Robert Koch Institute (RKI) changed the risk classification of the United States on March 7th.

The US was previously classed as a “high incidence area” by the RKI. These are regions where the incidence is over 200 Covid-19 cases per 100,000 residents with a period of seven days.

However, now it’s a “risk area” – which is used by German authorities to describe a region with an increased risk of infection, usually above 50 coronavirus cases per 100,000 people in seven days.

Other factors are also taken into account, such as measures in place.

It means the travel requirements for people coming from the US to Germany have changed.

However, entry from the US is only permitted in a few narrow exceptions. Proof of urgent need to travel is required, German authorities say. You can find more information in the story below.

READ MORE: When are Americans allowed to travel to Germany?

What happens if I need to travel from the US to Germany?

If you are a German resident from the US, or fall into one of the exception categories, you still face strict testing and quarantine measures.

All travellers must have a negative Covid-19 test result at the latest 48 hours after they enter Germany. It must be presented to authorities if they request it.

Some individual airlines may however still say that travellers have to present a coronavirus negative test result before boarding is allowed. You should contact your airline before travel to check.

Both PCR tests as well as rapid anitgen tests are accepted if they meet the quality standards. Testing is still mandatory even if travellers are vaccinated or have recovered from a coronavirus infection. 

People returning from “risk zones” are required to self-isolate for 10 days after they arrive.

The quarantine can usually be ended with a negative coronavirus test result taken at the earliest five days after arriving in Germany.

However, states can differ on their travel regulations so check with your local authority before travelling.

Everyone entering Germany is also required to register online.

New “high incidence areas”

In the RKI’s latest travel classification list, Sweden, Hungary and Jordan are now classed as “high incidence areas” which means stricter testing and quarantine rules apply.

Areas of “variant concern” include Austria’s Tyrol region, the UK, Brazil, Portugal and Ireland. Even stricter rules apply for these regions.

You can find out more information about travel rules in our story below.

READ MORE: What you need to know about Germany’s latest rules on foreign travel