AT&T chief scours Europe for suitable acquisitions

Randall Stephenson, chief executive of AT&T, is expected to be back in Europe this month to meet Neelie Kroes, the continent’s industry regulator. It will be the latest of his frequent visits, and a sign of how AT&T has been scouring the European mobile telecoms markets for acquisitions to expand outside its core US market.

AT&T was most recently linked with talks with the Spanish government over the availability of Telefónica. While Madrid talks were denied by government officials, AT&T has been talking to companies, government officials and regulators across Europe, according to corporate advisers. “The intelligence coming back from all parts of Europe is that AT&T is interested, even if there has not been any traction yet,” says one industry adviser. “AT&T is testing the waters,” says another informed person. “They are exploring everything, which means talking to everyone. But if it was to do a deal then the idea would be ‘go big, and go early’ as the opportunities will not last forever.” AT&T has made little secret of its desire to acquire European businesses, although its focus is on mobile telecoms, which would make a bid for a whole group such as Telefónica less likely.

AT&T’s European ambitions reflect the technology lead that US mobile operators believe they have now established over their European counterparts, after having lagged behind them in the 1990s and early 2000s. Stephenson sees an opportunity to capitalize on some of the lessons AT&T has learnt during its introduction of LTE-based 4G services in the US over the past two years. This includes the extraordinary growth of mobile broadband use that has resulted, and the potential for web-based services that can be provided over these new networks.