WASHINGTON-An official bid for VoiceStream Wireless Corp. has reportedly emerged.
According to press reports, Deutsche Telekom AG has offered more than $50 billion for the GSM operator. The Wall Street Journal said Friday both companies’ boards plan to consider the deal during the weekend, which could give VoiceStream some upfront cash to buy more spectrum.
VoiceStream and DT must secure commitments from VoiceStream’s two large shareholders, Finland’s Sonera Ltd. and Hong Kong’s Hutchison Whampoa Ltd.
To further complicate a potential deal, legislation proposed by Sen. Ernest Hollings (D-S.C.) to block purchases of U.S. telecom carriers by foreign-government-owned telecom firms has gained momentum. It was attached to a Commerce appropriations bill last week.
Federal Communications Commission Chairman William Kennard told Hollings in a July 20 letter the agency will carefully scrutinize any proposed purchase of a U.S. telecom carrier by a foreign-government controlled firm.
Kennard, under pressure from Hollings and other lawmakers, said such transactions “present unique competitive issues.” If Hollings’ legislation becomes law this fall, Deutsche Telekom and other foreign telecom companies may find it difficult to buy U.S. wireless carriers. The German government owns about 58 percent of DT.
Hollings said mergers driven by foreign-government-owned telecom firms raise national security issues and are anti-competitive.
