AT&T CEO Randall Stephenson knows a thing or two about wireless carrier mergers. He was leading the company when it tried to acquire T-Mobile back in 2011, but the transaction fell apart when the regulators expressed opposition and filed a lawsuit to block the deal.
Now that T-Mobile is on the verge of another merger — this time with Sprint, which would combine the third and fourth-largest U.S. carriers — Stephenson was asked about the pending deal on Wednesday at the Code Conference.
Stephenson, who took the helm of AT&T in 2007, said his competitors have a “tough hill to climb.” He didn’t say whether the merger should be approved or not.
“It’s a classic horizontal merger where you’re taking a competitor out of the marketplace,” he said. “But it is a very different marketplace today and there are a number of competitors out there in this space. A new competitor is coming into it every day, so it will probably get a different review than what our deal with T-Mobile received. But power to them, that they get it done.”
In April, T-Mobile announced plans to merge with Sprint after years of on-again, off-again talks. The two wireless carriers expect the merger to close by the first half of 2019, assuming they get regulatory approval.
The proposed $26.5 billion merger will create a more formidable rival to AT&T and Verizon Wireless. The combined company would be valued at $146 billion.
On a conference call with Sprint CEO Marcelo Claure last month, T-Mobile CEO John Legere — who would lead the new company — told reporters and analysts that the deal will create a “pro-consumer, strongly disruptive, revved-up competitor.” He expressed confidence that regulators will see consumer value in the deal and approve the acquisition.
Verizon Communications Chairman and CEO Lowell McAdam, meanwhile, isn’t losing sleep about the potential T-Mobile-Sprint tie-up.
“I think the U.S. has always been a competitive market,” he told GeekWire earlier this month. “Competition will probably be different if they’re together, but it’s still going to be a very competitive market. So we don’t care. It’ll take them two years — a year of approval and a year of integration — before they’re pointed into the wind, if you will. And we’re going to make the most out of those two years.”
