AT&T on Monday ended its pursuit of T-Mobile, bowing to government opposition to the $39 billion deal that would have created the nation’s biggest mobile provider of phone and Internet service.
The companies agreed to end last-ditch negotiations to restructure their merger and win over leery antitrust officials. As a penalty, AT&T will hand to T-Mobile’s parent, Deutsche Telekom, $4 billion worth of cash and other assets.
AT&T chief executive Randall Stephenson said regulators should “allow the free markets to work.”
“The mobile Internet is a dynamic industry that can be a critical driver in restoring American economic growth and job creation, but only if companies are allowed to react quickly to customer needs and market forces,” he said in a statement.
Nevertheless, the decision puts an end to an audacious nine-month lobbying and legal assault by AT&T, the nation’s second-largest wireless company, to become the wireless industry leader through its purchase of T-Mobile.
By combining the companies’ networks, AT&T had hoped to better feed America’s insatiable appetite for watching streaming movies, sending e-mails and surfing the Web over smartphones and tablets.
It spent tens of millions of dollars on lobbying and national ads touting its merger and its ability to create jobs.
But even from the beginning, antitrust officials at the Federal Communications Commission and Justice Department said the deal would be hard to approve.