Analysts put bets on AT&T, T-Mobile merger, even with setbacks

AT&T’s bid for T-Mobile? Possibly, but not enough to stop the deal, some analysts say.

They say a call by Senator Herb Kohl (D-WI) to block the deal and a delay in the Federal Communication’s review will embolden critics and put greater focus on how the deal will affect competition in the wireless industry and ultimately change monthly bills for consumers. But in the end, that may just mean more conditions on the $39 billion merger, some experts say. “The ebbs and flows of merger reviews create moments of pause that sometimes imply greater uncertainty and risk than what actually exist,” said Jeffrey Silva, an analyst at Medley Global Advisors in a research note. “This appears to be one of those moments, though the warning signs should not be ignored.”

Silva and other industry analysts say there are factors that can affect the final decision by federal regulators beyond the analyses being done within Justice and the FCC. Among them: Who will replace Christine Varney as head of Justice’s antitrust division and can AT&T or merger critics influence who is nominated? How much weight with regulators put on state attorney generals objections to the merger and hearings by California’s Public Utilities Commission?