March 7, 2014 8:04 pm

AT&T chief cools hopes of Vodafone bid

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Randall Stephenson, AT&T’s chief executive, poured more cold water on speculation that the US telecoms group might bid for Britain’s Vodafone , telling his audience at an investor conference that, “the window may be closing on perhaps owning wireless assets” in Europe.

This year AT&T was forced by Britain’s Takeover Panel to rule itself out of bidding for Vodafone for six months, after speculation mounted that the US company might bid for the rest of Vodafone once the sale of the UK company’s 45 per cent stake in Verizon Wireless to Verizon Communications for $130bn was completed. The Verizon Wireless deal closed two weeks ago.

Despite the AT&T statement in January, many analysts still expected an AT&T offer for Vodafone to materialise at some stage. However Mr Stephenson, who was asked about investment opportunities in Europe at a Morgan Stanley conference, indicated that the opportunity to exploit the growth of the mobile internet and the deployment of 4G technology including LTE, may be closing.

“Europe way underinvested for quite some period of time in terms of LTE,” said Mr Stephenson who attended the Mobile World Congress trade show in Barcelona last month. But he said that is now changing with LTE being deployed broadly in the UK and Germany. “What we had always believed was going to transpire is now transpiring,” he said.

In addition he noted that the balance sheets of a number of the European carriers, which had been stressed, hindering them from doing much investment, have since been shored up. “As you see these investments happening, you may kind of begin to think the window may be closing on perhaps owning wireless assets,” he said.

But echoing comments he made a year ago, the AT&T chief executive said, “there are still other opportunities in Europe.” In particular he noted that AT&T’s investment in creating a global SIM “still gives us opportunities to take advantage of a European expansion of LTE.”

He added: “We think there are still lots of opportunities in Europe. We’re still pretty excited about Europe, but it is finally beginning to take off and people are finally investing there.”

Asked about competition in the US market, Mr Stephenson noted that following proposed merger of Comcast and Time Warner Cable, the expanded cable TV group would cover 80 per cent of US households “It’s an industry redefining deal from our standpoint,” the AT&T chief executive said. But he added that AT&T expects the deal to be approved by US regulators, albeit with conditions. “It probably gets done, and it’s probably going to have some hair on the transaction,” he said.

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