US incumbent AT&T may acquire an operator in Europe with KPN and EE (formerly Everything Everywhere) on its radar, according to a report in the Wall Street Journal.
An acquisition could come before the end of the year the US business daily reported,…
US incumbent AT&T may acquire an operator in Europe with KPN and EE (formerly Everything Everywhere) on its radar, according to a report in the Wall Street Journal.
An acquisition could come before the end of the year the US business daily reported, citing people familiar with the operator’s thinking.
Meanwhile in an interview this month with local publication Texas Monthly, AT&T’s CEO Randall Stephenson said that looking at acquisitions overseas was “inevitable” for the operator.
Some executives at AT&T reportedly believe that now a window has opened up for an acquisition as the share prices of European operators have taken a beating and pricing strategies on the continent are still focused on voice and text, rather than the more lucrative data-focused charging which the US market has moved to.
The Dallas, Texas-based telco’s last notable acquisitive play was for T-Mobile USA. That US$39bn deal collapsed in late 2011 after US regulators effectively blocked the transaction on antitrust grounds.
AT&T currently enjoys a duopoly with Verizon atop the US market, but it now faces the prospect of increased competition. T-Mobile USA agreed a reverse merger with MetroPCS last October and in the same month Japanese group Softbank struck a deal to buy 70% of Sprint Nextel for US$20bn. Sprint is now working on getting its hands on Clearwire Corporation’s vast spectrum holdings and a deal for it to buy the merged T-Mobile USA/MetroPCS business has been mooted as something that may happen further down the line.
All these factors would play into AT&T looking abroad for growth, although it is not clear whether the incumbent is in talks with any specific operator or if it has decided on any particular telco. However, it was reported that it was at least looking at UK operator EE and Dutch telco KPN.
KPN is now 28% owned by Carlos Slim’s America Movil, which AT&T in turn holds a 9.39% stake in, according to the US company’s last annual report.
Slim worked with Stephenson in the 1990s at Telefonos de Mexico and the two are reported to be friends.
