Deutsche Telekom Says Break-Up Fee Not In Danger If AT&T Deal Fails

Since the announcement of the AT&T/T-Mobile deal the press and mobile industry at large has been under the impression that should the deal fall through, AT&T was on the line for up to $6 billion in cash and spectrum. A Reuters report from yesterday indicated that the break-up fee as it has been dubbed isn’t as certain as the deal itself just being nullified, closed, killed or destroyed by the government. Reuters sources indicated that certain conditions must be met in order for Deutsche Telekom to recoup the break-up fee such as the value level of T-Mobile or the timeframe in which the deal closes.

This mornings report courtesy of the Wall Street Journal indicates that Deutsche Telekom isn’t indicating that the fee is in any danger should the deal not close. A Deutsche Telekom spokesman said Tuesday that AT&T could “retreat from the transaction if the concessions necessary to get approval amount to more than $7.8 billion, but added Deutsche Telekom would still be entitled to receive the break-up fee package.”

So the AT&T/T-Mobile deal remains up in the air pending the Department of Justice search for an injunction and yet Deutsche Telekom remains confident that if the outcome doesn’t fall on the side of the deal closing they will still be entitled to the $6 billion break-up fee.

Wall Street Journal

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  • jarvis billena

    Blah Blah Blah

  • Anonymous

    Hell yeah!

  • Anonymous

    From my understanding T-Mobile will not see the break up money… It will go straight to Deutsche Telekom and if the deal falls threw Deutsche Telekom will not be giving T-Mo USA anymore money. 

    (This is what they told my wife in a conference call after the DOJ announcement)

    • http://twitter.com/PaulHarrisonPro Paul Harrison

      It’s not all in money, about half the “break-up fee” is in spectrum, and I don’t see DT being able to make use of that from across the ocean…

      • http://darnell-chat.myopenid.com/ Darnell

        They will sell that spectrum to the highest bidder.  They will not be giving it to T-Mobile USA.  Count on it, this is about DT lining its own pockets.  They’ve left the little US unit that’s trying to tread water for the wolves.

      • http://darnell-chat.myopenid.com/ Darnell

        They will sell that spectrum to the highest bidder.  They will not be giving it to T-Mobile USA.  Count on it, this is about DT lining its own pockets.  They’ve left the little US unit that’s trying to tread water for the wolves.

      • http://darnell-chat.myopenid.com/ Darnell

        They will sell that spectrum to the highest bidder.  They will not be giving it to T-Mobile USA.  Count on it, this is about DT lining its own pockets.  They’ve left the little US unit that’s trying to tread water for the wolves.

        • jon

          Slight correction..its 2billion in spectrum and 1billion in roaming agreements. The roaming definately can’t be sold. I also don’t believe the us govt would allow the spectrum to be sold to anyone else. They’ve already been very heavy handed here. DT will have to use that 6billion to attract another buyer (NOT currently one of the other big three).

        • jon

          Slight correction..its 2billion in spectrum and 1billion in roaming agreements. The roaming definately can’t be sold. I also don’t believe the us govt would allow the spectrum to be sold to anyone else. They’ve already been very heavy handed here. DT will have to use that 6billion to attract another buyer (NOT currently one of the other big three).

        • jon

          Slight correction..its 2billion in spectrum and 1billion in roaming agreements. The roaming definately can’t be sold. I also don’t believe the us govt would allow the spectrum to be sold to anyone else. They’ve already been very heavy handed here. DT will have to use that 6billion to attract another buyer (NOT currently one of the other big three).

      • http://darnell-chat.myopenid.com/ Darnell

        They will sell that spectrum to the highest bidder.  They will not be giving it to T-Mobile USA.  Count on it, this is about DT lining its own pockets.  They’ve left the little US unit that’s trying to tread water for the wolves.

  • http://darnell-chat.myopenid.com/ Darnell

    Problem is, that Deutsche Telekom will take the spoils and not invest it in building up T-Mobile USA.  They’ve hung T-Mobile out to dry and that’s the real shame of it all.

    • Xavier Carryl

      Then what is DT going to do with the spectrum they get?

  • Frigadroid

    At&t and DT will manage I’m sure. What I’m interested in is what’s in it for us and the tmobile employees.
    I’m sitting on the fence about two more years. Perhaps a one year option might sell well if made available, with the future uncertainty looming.

  • Frigadroid

    At&t and DT will manage I’m sure. What I’m interested in is what’s in it for us and the tmobile employees.
    I’m sitting on the fence about two more years. Perhaps a one year option might sell well if made available, with the future uncertainty looming.

  • Frigadroid

    At&t and DT will manage I’m sure. What I’m interested in is what’s in it for us and the tmobile employees.
    I’m sitting on the fence about two more years. Perhaps a one year option might sell well if made available, with the future uncertainty looming.

  • Frigadroid

    At&t and DT will manage I’m sure. What I’m interested in is what’s in it for us and the tmobile employees.
    I’m sitting on the fence about two more years. Perhaps a one year option might sell well if made available, with the future uncertainty looming.

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    $ $ $

  • NBIQ

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    $ $ $

  • NBIQ

    Ahhh.. The Deutsche Telecom MASTER PLAN
    $ $ $

  • NBIQ

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    $ $ $

  • Anonymous

    Well that news is somewhat good. At least if this falls through T-mobile will get something in minor compensation for the losses they suffered due to the publicity of such a deal.

  • Anonymous

    Well that news is somewhat good. At least if this falls through T-mobile will get something in minor compensation for the losses they suffered due to the publicity of such a deal.

  • Anonymous

    Well that news is somewhat good. At least if this falls through T-mobile will get something in minor compensation for the losses they suffered due to the publicity of such a deal.

  • Anonymous

    Well that news is somewhat good. At least if this falls through T-mobile will get something in minor compensation for the losses they suffered due to the publicity of such a deal.

  • IT Guy

    I would tend to think there’s some truth to both the WSJ article and the report yesterday from Reuters.

    When these kinds of deals come together, they are pretty thorough on the terms and conditions, and what happens should things fall through.That’s what they pay the attorneys and accountants so much.

    I suspect the reality is that while there are stipulations that would nullify AT&T’s requirement to pay out to DT if things don’t work out, neither side thinks those terms will be met.     

  • IT Guy

    I would tend to think there’s some truth to both the WSJ article and the report yesterday from Reuters.

    When these kinds of deals come together, they are pretty thorough on the terms and conditions, and what happens should things fall through.That’s what they pay the attorneys and accountants so much.

    I suspect the reality is that while there are stipulations that would nullify AT&T’s requirement to pay out to DT if things don’t work out, neither side thinks those terms will be met.     

  • IT Guy

    I would tend to think there’s some truth to both the WSJ article and the report yesterday from Reuters.

    When these kinds of deals come together, they are pretty thorough on the terms and conditions, and what happens should things fall through.That’s what they pay the attorneys and accountants so much.

    I suspect the reality is that while there are stipulations that would nullify AT&T’s requirement to pay out to DT if things don’t work out, neither side thinks those terms will be met.     

  • Anonymous

    I have a feeling there are some easy ways for AT&T to get out of this deal that DT is trying to cover up.  The wording DT uses is very peculiar.

    I don’t have a subscription to WSJ to read the whole article, but David’s quote states that if AT&T retreats DT would get a breakup fee. 

    What if AT&T doesn’t retreat and the government forces a cancellation of the merger.  In that situation i think the regulatory clause mentioned in the Reuters article would apply.

  • ConspiracyTheory

    What does this mean for our severance pay??

    • My2Cents

      It means severance is out.  The severance reads that payout only occurs if we are severed from the company or turned down relocation outside of a certain mileage threshold.

    • My2Cents

      It means severance is out.  The severance reads that payout only occurs if we are severed from the company or turned down relocation outside of a certain mileage threshold.

    • My2Cents

      It means severance is out.  The severance reads that payout only occurs if we are severed from the company or turned down relocation outside of a certain mileage threshold.

      • My2Cents

        oops.. i mean only that if the deal does not go through… sorry.

      • My2Cents

        oops.. i mean only that if the deal does not go through… sorry.

      • My2Cents

        oops.. i mean only that if the deal does not go through… sorry.

        • Anonymous

          Hey my2cents..long time

      • ConspiracyTheory

        This is devastating! Buit maybe the HR body snatchers will ease up on the firing sprees…

      • ConspiracyTheory

        This is devastating! Buit maybe the HR body snatchers will ease up on the firing sprees…

  • johnwall

    maybe DT are rethinking about selling tmobile usa and take the 3 billion dollars and maybe maybe i use maybe loosely invest it in both carriers in the usa and uk. lol  because if 2 billion dollars is in spectrum they can gain more costumers in the future maybe? and 1 billion dollars is in roaming fee they could make a killing if they keep them and invest in both company.. just saying

  • johnwall

    maybe DT are rethinking about selling tmobile usa and take the 3 billion dollars and maybe maybe i use maybe loosely invest it in both carriers in the usa and uk. lol  because if 2 billion dollars is in spectrum they can gain more costumers in the future maybe? and 1 billion dollars is in roaming fee they could make a killing if they keep them and invest in both company.. just saying

  • Anonymous

    Great news for my favorite Carrier, T-Mobile. Hoping this deal does fall thru and T-Mobile can take their money and spectrum and maybe join in with the same LTE that Sprint is going to use. I believe this is all Satellite technology and would save allot of cable running and that kind of grunt work. What ever they do I just want T-Mobile to do well in the US market. IMO they treat their customers so much better then any other Carrier in this country. I have been with them all and have several accounts with different Carriers and by far T-Mobile is the best. In my area (Boston) their HSPA+ Network blows away AT&T and Sprint’s service by far.

    • Silk7412

      thats my city too !!!

  • http://www.facebook.com/people/DOne-Burrell/507890855 D’One Burrell

    Vinnjr, that money would go to DT, not T-Mobile.  So just because the deal may not go through, doesn’t mean T-Mobile is out of the woodwork…..

    • SuperNova

      but its not all cash, tmobile gets spectrum to use too . . . 

  • MIKEEEEE

    sure does make me feel all warm and fuzzy that t-mo employees look like they’re att employees instead of t-mo employees.

    the deal aint closed yet, so why are the executives talking like they’re att?

    do they honestly think they have jobs waiting for them?

    t-mo should just keep quiet and let att do all the talking.

    • derek 21

      because they still will have jobs damn  do people read if it goes through they get to sit right on the board of directors at AT*T Land, the top execs want this for the money and major stake in at &t company equals money whether they have something you consider a job or not.

    • derek 21

      because they still will have jobs damn  do people read if it goes through they get to sit right on the board of directors at AT*T Land, the top execs want this for the money and major stake in at &t company equals money whether they have something you consider a job or not.

    • derek 21

      because they still will have jobs damn  do people read if it goes through they get to sit right on the board of directors at AT*T Land, the top execs want this for the money and major stake in at &t company equals money whether they have something you consider a job or not.

  • Silk7412

    seen this at the fcc.
    I’m trying to understand.1. Is it ATT’s thinking that if they bring back the people they fired is a way of making MORE jobs?
    2. If i’m a Tmobile employee will i be made to join the union?
    3.How much competition is it with one GSM carrier?
    4.Is ATT tell us that they can be trusted but they still manipulate and deceive there own customers and i can’t wait for them to do it to me !!!! NOT !!

    • derek 21

      No 1. That idea you typed wouldn’t fly in court you can’t fire people bring them back and call it new jobs, that would not be a concession.
      2. It’s your choice to join a union in AT&T case they lead the mobile word in wages/ benefits  it would probably in best benefit to join as I know many tmo coworkers that would be happy if this deal goes through, so they can actually have a voice , if they keep their job of course.
      3. It’s still plenty competition it’s retarded for people to keep bringing up competition, if sprint buys tmobile it’s the same situation,. Long as one company doesn’t give a customer everything they want, it’ll always be competition. Way of America
      4. At&T is a corporation just like other corporations they are out to make money if you think any different you deserve to be deceived, no offense

    • derek 21

      No 1. That idea you typed wouldn’t fly in court you can’t fire people bring them back and call it new jobs, that would not be a concession.
      2. It’s your choice to join a union in AT&T case they lead the mobile word in wages/ benefits  it would probably in best benefit to join as I know many tmo coworkers that would be happy if this deal goes through, so they can actually have a voice , if they keep their job of course.
      3. It’s still plenty competition it’s retarded for people to keep bringing up competition, if sprint buys tmobile it’s the same situation,. Long as one company doesn’t give a customer everything they want, it’ll always be competition. Way of America
      4. At&T is a corporation just like other corporations they are out to make money if you think any different you deserve to be deceived, no offense

    • derek 21

      No 1. That idea you typed wouldn’t fly in court you can’t fire people bring them back and call it new jobs, that would not be a concession.
      2. It’s your choice to join a union in AT&T case they lead the mobile word in wages/ benefits  it would probably in best benefit to join as I know many tmo coworkers that would be happy if this deal goes through, so they can actually have a voice , if they keep their job of course.
      3. It’s still plenty competition it’s retarded for people to keep bringing up competition, if sprint buys tmobile it’s the same situation,. Long as one company doesn’t give a customer everything they want, it’ll always be competition. Way of America
      4. At&T is a corporation just like other corporations they are out to make money if you think any different you deserve to be deceived, no offense

  • Anonymous

    If you have a car that goes +300mph but your speed limit is 60mph that really only goes at 150mph?  Why have it.  The only reason you do, is one of the following:

    a) You like to floor it once in a while
    b) You can afford it
    c) You need to run away for some reason.

    Now if you are limited to use this car for only 4000 miles each month.  Because if you do, the dealer will charge you extra due to your lease.

    Thats the situation you have with LTE you theoretically get 100Mbps limited to 2GB per month.

    Verizon’s LTE is limited to 30Mbps and 2GB per month that really works at 14Mbps. Then you have Sprints Wimax and TMobile’s HSPA+ (ATT’s service is not worth considering, cause there is none worth talking about).

    Sprint offers 7Mbps and TMobile HSPA+ runts at 42Mbps (11Mbps true speed).  

    The question then becomes, why does ATT need any bandwidth.

    To begin with, they have the most bandwidth and the worst service (its not worth even considering for comparison because it tops out at 3Mbps if it works, 1.2Mbps is more like it.  So now they state they need TMobile’s spectrum to provide what they dont even have.

    TMobile will be hurting if they don’t take steps to exists if the merger is declined, and this is now the most likely outcome.  ATT will try to get out of paying the 6-7B and knowing how they operate, they will squirm everyway possible to avoid it.

    If that they ever happens, where the merger is completely dead. A lot of TMobile customers will have a huge smile on their faces.  Can’t say the same for ATT’s/Tmob executives.

  • Anonymous

    If you have a car that goes +300mph but your speed limit is 60mph that really only goes at 150mph?  Why have it.  The only reason you do, is one of the following:

    a) You like to floor it once in a while
    b) You can afford it
    c) You need to run away for some reason.

    Now if you are limited to use this car for only 4000 miles each month.  Because if you do, the dealer will charge you extra due to your lease.

    Thats the situation you have with LTE you theoretically get 100Mbps limited to 2GB per month.

    Verizon’s LTE is limited to 30Mbps and 2GB per month that really works at 14Mbps. Then you have Sprints Wimax and TMobile’s HSPA+ (ATT’s service is not worth considering, cause there is none worth talking about).

    Sprint offers 7Mbps and TMobile HSPA+ runts at 42Mbps (11Mbps true speed).  

    The question then becomes, why does ATT need any bandwidth.

    To begin with, they have the most bandwidth and the worst service (its not worth even considering for comparison because it tops out at 3Mbps if it works, 1.2Mbps is more like it.  So now they state they need TMobile’s spectrum to provide what they dont even have.

    TMobile will be hurting if they don’t take steps to exists if the merger is declined, and this is now the most likely outcome.  ATT will try to get out of paying the 6-7B and knowing how they operate, they will squirm everyway possible to avoid it.

    If that they ever happens, where the merger is completely dead. A lot of TMobile customers will have a huge smile on their faces.  Can’t say the same for ATT’s/Tmob executives.

  • Anonymous

    If you have a car that goes +300mph but your speed limit is 60mph that really only goes at 150mph?  Why have it.  The only reason you do, is one of the following:

    a) You like to floor it once in a while
    b) You can afford it
    c) You need to run away for some reason.

    Now if you are limited to use this car for only 4000 miles each month.  Because if you do, the dealer will charge you extra due to your lease.

    Thats the situation you have with LTE you theoretically get 100Mbps limited to 2GB per month.

    Verizon’s LTE is limited to 30Mbps and 2GB per month that really works at 14Mbps. Then you have Sprints Wimax and TMobile’s HSPA+ (ATT’s service is not worth considering, cause there is none worth talking about).

    Sprint offers 7Mbps and TMobile HSPA+ runts at 42Mbps (11Mbps true speed).  

    The question then becomes, why does ATT need any bandwidth.

    To begin with, they have the most bandwidth and the worst service (its not worth even considering for comparison because it tops out at 3Mbps if it works, 1.2Mbps is more like it.  So now they state they need TMobile’s spectrum to provide what they dont even have.

    TMobile will be hurting if they don’t take steps to exists if the merger is declined, and this is now the most likely outcome.  ATT will try to get out of paying the 6-7B and knowing how they operate, they will squirm everyway possible to avoid it.

    If that they ever happens, where the merger is completely dead. A lot of TMobile customers will have a huge smile on their faces.  Can’t say the same for ATT’s/Tmob executives.

  • arizdegenerate

    I still think the best outcome would be at&t to lose the bid and DT to sell to Google. I really could see Google being interested in having their own carrier to launch all the new “NEXUS” phones. They bought Motorola Mobility I think for the hardware. I can see them bidding for T-Mobile for the carrier.

    • Steve

      The moment Google buy T-Mobile I cancel my T-Mobile account and go somewhere else.

      I don’t want anything Google in my life.