The deal includes $25 billion in cash and the rest in AT&T stock. Deutsche Telekom would receive an 8% stake and a seat on AT&T's board as part of the transaction
New York: US telecom giant AT&T has said it will buy T-Mobile USA for $39 billion from Deutsche Telekom, the European telecom company, reports PTI.
In a statement AT&T Inc and Deutsche Telekom AG announced that "They have entered into a definitive agreement under which AT&T will acquire T-Mobile USA from Deutsche Telekom in a cash-and-stock transaction currently valued at approximately $39 billion.
The deal, which was approved by the boards of both companies, includes $25 billion in cash and the rest in AT&T stock. Deutsche Telekom would receive an 8% stake and a seat on AT&T's board as part of the transaction.
The deal will benefit customers, who would get access to AT&T's 4G technology. Besides, AT&T said the deal would help boost US infrastructure and improve network quality.
"This transaction represents a major commitment to strengthen and expand critical infrastructure for our nation's future," AT&T chairman and CEO Randall Stephenson said.
"This transaction delivers significant customer, shareowner and public benefits that are available at this level only from the combination of these two companies with complementary network technologies, spectrum positions and operations," Mr Stephenson added.
The acquisition is expected to close in 12 months, subject to regulatory approvals.
The acquisition would reduce the number of wireless carriers in the US from four to three and is likely to face intense regulatory scrutiny.
The deal would add 34 million customers to AT&T's current 96 million and the combined entity would serve about 43% of US cell phones.
The deal would also advance AT&T's annual wireless revenues to $80 billion from $58.5 billion at present.
With the rising import bill of IT and telecom products, the IT Task Force has recommended that the government develop an eco-system for boosting indigenous manufacturing
New Delhi: In order to boost manufacturing of indigenous equipment, the Centre may extend preferential status to 'Made in India' products in the New Telecom Policy, 2011 (NTP'11), reports PTI.
"Broader telecom policy will include measures appropriate to encourage domestic telecom manufacturing. Some aspects have been considered by the Committee of Secretaries, and preferential status for domestic manufacturers is one of them," Department of Telecom (DoT) secretary R Chandrashekhar told PTI.
Mr Chandrashekhar said DoT is waiting for recommendations from the Telecom Regulatory Authority of India (TRAI) on manufacturing and expects to receive them by end of March.
He said communications and IT minister Kapil Sibal is holding consultations with the industry and their views will be discussed by the Telecom Commission while finalising the NTP'11 draft.
"A final view will be taken after the consultation process is complete. We expect it to be done by end of March," Mr Chandrashekhar said.
The push for preferential treatment for 'Made in India' products is part of the government's agenda to reduce the widening trade deficit created by imports.
Mr Chandrashekhar said the decision to encourage telecom manufacturing is in line with the recommendations made in the IT Task Force report, which is being processed by the Department of Information Technology.
Citing the rising import bill of IT and telecom products, the Task Force has recommended that the government develop an eco-system for boosting indigenous manufacturing.
Estimates show that India's demand for electronics products (including telecom) will be $400 billion by 2020.
Meanwhile, at the existing rate of growth, the production of electronics hardware is likely to grow to $104 billion by 2020, creating a demand-supply gap of $296 billion, which would have to be met through imports.
The Wireless Planning Commission (WPC), a DoT wing for spectrum management, has also decided to reserve some radio waves for indigenously developed technologies and systems in the new National Frequency Allocation Plan of 2011.
The move, however, has been opposed by telecom lobby groups-Cellular Operators Association of India and Association of Unified Telecom Service Providers of India.
Sanjay Dutt, CEO for business with Jones Lang LaSalle India, says Mumbai’s residential property rates are seeing a small correction in some pockets. This correction phase will continue for the next three months and inevitably extend into the traditionally slower monsoon and vacation period, mainly on the urgent need for capital by city developers. But other realty analysts are not so sure about the timing or the extent of the correction
The Mumbai real estate sector is seeing a downward spiral in sales and sales registrations, principally due to exorbitant prices. However, experts say that it is difficult to predict when corrections will take place, as long as the holding stock is not released.
According to a report by Prabhudas Lilladher, a Mumbai-based research and financial services agency, sales volumes in the city and suburbs have fallen 45% from the 2010 peak, and sales registrations have seen a 22% year-on-year decline. Since the beginning of 2011, the figures have been dismal. However, registration of leases continues to trend up, which indicates that high interest rates and hopes of a correction are prompting people to delay making purchases.
But it's uncertain when this correction will happen. An analyst said, "A correction will happen, but we cannot say exactly when. It may not be anytime soon." When asked about the continued high pricing of property, he said, "Prices can only correct if builders who are holding available stocks release their grip and quote affordable prices. But they will continue to hold until they see that profits are ensured."
Off-take has been almost nil. Pankaj Kapoor, managing director, Liases Foras estimates that more than 88,000 residential properties remain unsold in Mumbai proper itself. He said, "When builders and agents put the price of an average flat at something near a crore, how can anyone afford it?"
According to Jones Lang La Salle, in the 2009 slowdown, Rs12,000 crore was spent in Mumbai to stock up inventories. The funding came at high interest rates. Then, prices appreciated by 43% in 2010. While the Union Budget has increased the home loan limit from Rs20 lakh to Rs25 lakh, it has not improved the situation.
Only last week, the Reserve Bank of India (RBI), hiked repo and reverse repo rates by 0.25% to 6.75% and 5.75% in order to arrest liquidity, and this is likely to result in higher rates for home loans also. This is the eighth time in a year that the RBI has hiked rates.
Investments in realty have also gone down, as returns have not been significant, and investors have turned to commodities which are trading at record prices, according to an analyst. The BSE realty index has plunged 36.70% since March 2010.
Various financial research and advisory agencies, like Morgan Stanley and Crisil, believe that a 15%-20% correction in Mumbai real estate prices can be expected, but there has been no sign of any correction till now. Rather, prices have shot up in some new areas. Builders cite increased input costs as a major reason for maintaining high prices.
"With unfriendly interest rates and unavailability of feasible loans, prospective customers have delayed purchases. Most of them are waiting for the prices to come down," said the analyst. "But as long as stocks are held back, neither can a correction happen, nor can there be any growth in sales."
Sanjay Dutt, chief executive officer, business, Jones Lang La Salle, thinks that an increasingly urgent need for capital may lead developers to go in for a correction, though not much difference has been observed in prices. He said, "Prices have dropped in areas such as Parel, Lower Parel, Mahalaxmi, Bandra (East), Andheri (East), Goreagon (East), Mulund and Kurla. There are several other locations within Mumbai and Thane district that may not have seen a correction of more than 5-10%."
Mr Dutt says Mumbai's residential property rates today are back at 2008 levels. The overall sentiment in the market and the consistent rate of new project launches in Mumbai, gives a clear indication of an impending oversupply by 2012. If the prices don't come down, soon, the coming days will prove to be bleak for both the market and homebuyers.