New deal within 6 months possible if situation changes dramatically

Following speculation AT&T would make a bid for Vodafone somewhere north of $60 billion, the second-largest U.S. carrier has filed a statement saying it won't pursue the action any further. The official statement comes as a result of U.K. laws — in this case the U.K. Takeover Code — which require companies to release written statements as to their intentions of bid for a U.K. company.

Now our U.K. law prowess isn't of the highest degree, but it seems as though AT&T never actually had much of a serious intention to make a bid for Vodafone to begin with. And in light of the negative effects of the speculation on Vodafone's stock price — down about 3 percent over the weekend — AT&T was required to make a statement reflecting its true intentions.

Citing note 2 of Rule 2.8 of the UK Takeover Code, AT&T does have the right to make a bid for Vodafone in the next six months provided the circumstances fall into line with the notes on that rule. Loosely put, note 2 of Rule 2.8 gives AT&T the opportunity to make another bid for Vodafone if the deal structure changes dramatically (i.e. a reverse takeover), another company makes a serious offer to buy AT&T itself, or the U.K. authorities decide that there has been a dramatic change in circumstances surrounding an AT&T-Vodafone buyout.

That's all big and complicated with lots of legal jargon, but the end result looks to be AT&T putting a bid for Vodafone on the back burner for now. Unless something dramatically changes, we won't see the carrier making such a splash in Europe — or at least the U.K. — any time soon.

Source: AT&T; U.K. Takeover Panel


Reader comments

AT&T backs out of Vodafone bid at request of UK authorities


Oceans of red tape and legalities smh. Gives me a headache just reading about it.

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I hear you but it was a crappy deal from go for Europe. It would be like Verizon buying Verizon here in the US, no one wins.

That is a very narrow view and maybe uneducated on my part, but I did not get to look into it at all since it was a 24 hour deal.

Almost sounds like a ploy for some top execs at Vodaphone to boost their stocks briefly to sell off and get out of the company after Verizon's pay day to buy back the other half. If I was the FEC enlivenment in Britain or Europe I'd be looking for anyone dumping a bunch of their stock after it went up after the buyout announcement.

They would never have used their new power to leverage any of the things you mentioned in the other thread. It would just be another opportunity for them to nickel and dime the customers. They want to be able to collect twice as much international roaming, not make roaming cheaper.

Now, if you become the CEO of AT&T and bring those changes to fruition yourself I'll support the merger gladly. Otherwise, I can't be optimistic.

This was certainly a very well calculated move. We, the general public can only speculate but the enlightened few accomplished exactly what they wanted to. For the rest of us, time will tell what that was all about.

It's nice to see that the UK isn't full of blind people. Now only if we can get not-so-smart Americans using the intelligence that God gave them.

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(ZeroLemon 7000mah battery)

Well thank God. I wasn't that keen on changing carriers but a AT&T owned Vodafone would definitely make me change.