AT&T Inc, with its T-Mobile USA takeover facing regulatory opposition, is preparing the biggest remedy proposal yet to the US Department of Justice to salvage the US$39 billion deal, according to a person familiar with the plan.
The company is considering an offer to divest a significantly larger portion of assets than it had initially expected, said the person, who declined to be identified because the plan isn’t public. Though the exact size of the disposals hasn’t been determined, they could be as much as 40 percent of T-Mobile USA’s assets, the person said.
The asset sale is an attempt to address the concerns of the Department of Justice, which sued to block the takeover on Aug. 31, saying the deal would “substantially lessen competition” in the wireless market. The acquisition was dealt another blow on Tuesday, with the Federal Communications Commission signaling an attempt to block it.
AT&T’s proposal is likely to include the divestiture of a higher share of customers and lower percentage of spectrum, the person familiar with the matter said. The company needs more capacity to serve users as it adds customers and more of them adopt data-intensive smartphones.
The asset-sale proposal, which could come as early as the next Department of Justice hearing on Wednesday, might be the only remaining option if the second-largest US wireless operator wants to avoid a lengthy court battle in its bid to become the country’s top mobile carrier.
AT&T said it would take a one-time charge of US$4 billion to cover the breakup fee it will need to pay to Deutsche Telekom if the deal fails.
One approach is to propose a remedy that would lessen the market impact of losing the fourth-largest wireless service provider. AT&T has been in discussions with MetroPCS Communications Inc and Leap Wireless International Inc to sell spectrum and customers as a way of propping up competition in the absence of T-Mobile.
The second approach is to fight the court case, which is scheduled to begin Feb. 13.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
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