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Why wouldn't the merger go through

Discussion in 'Central US Wireless Forum' started by warriorfootball9, Aug 10, 2004.

  1. warriorfootball9

    warriorfootball9 Junior Member
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    I have herd about the Cingular and ATTWS merger and everyone says that if it goes through. Why would not the merger go through. Does it have to do something with the FCC?
     
  2. rich6880

    rich6880 Senior Member
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    The merger is going to happen, however, whenever, the govt is involved, you can never be sure. The merger has to be approved by govt agencies, since the industry is regulated.
     
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  3. warriorfootball9

    warriorfootball9 Junior Member
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    Thanks for the info Rich. what agencies are involved? as of right now are there any possible reasons why the government wouldnt let this go through?
     
  4. Matt

    Matt Twin girls!
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    FCC and Department of Justice are the main agencies. There should not be any problems.
     
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    #4 Matt, Aug 10, 2004
    Last edited by a moderator: Aug 10, 2004
  5. rich6880

    rich6880 Senior Member
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    I was just going to give you the same answer as Matt, but he beat me to it. As I said, before, it has to be approved by various agencies. I think that the highest hurdle would be DOJ. They have to approve the antitrust aspect of the merger, this is intangilbe and could go either way, but a worst case scenario in my mind, would be the required divestiture of certain parts of the business or some assets.

    Best guesstermates are Oct or Nov for a final answer.
     
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  6. ShoresGuy

    ShoresGuy Euer WA Experte in Europa
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    Is the FTC (Federal Trade Commission) involved in the major approval as well?
     
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  7. Matt

    Matt Twin girls!
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    I don't think so, but I'm not sure.
     
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  8. rich6880

    rich6880 Senior Member
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    As I said previously, I think that the only possible obstacle would be the DOJ. If they feel that the post merger Company is in violation of AntiTrust Laws, they can either prevent the merger or require certain divestitures.

    However, before a potential merger gets to this point. Highly paid and knowldegable corporate lawyers, are fairly certain that the merger will be accepted by all Govt Agencies, including Justice and the FCC.

    I am speaking from many years of experience, as a Govt Tax Auditor, who has audited post merger companies.
     
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  9. BillRadio

    BillRadio Wireless Consultant
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    The feds are not looking at any reason to deny the buyout, they are responding to the aspects of losing competition in certain markets.

    Since this buyout will most likely be a model for further combinations of large carriers, a number of groups, both in and outside of the federal government, are reviewing all aspects of the deal. Several consumer groups are also involved. Both they and the feds are looking at what happens when a markets loses one carrier in a market of many (6+) carriers, and more importantly, what happens when a markets loses one of less than 3 carriers.

    In those smaller markets, and granted there aren't many of them, while losing one competitive carrier would agree with the letter of the law, losing one in a small market could be considered a serious reduction in competition. This is the very consideration that killed the Dish Network/DirectTV deal.

    In this case, it should only limit how many markets need to be "spun off" or somehow otherwise addressed, to maintain a certain level of competition.

    What may hurt (I hesitate to say "kill") the deal is that AT&T Wireless continues to deliver an inferior product and poor customer service, which may cause the buyers to reconsider, if nothing else, the final price.
     
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