Boston, MA 12/12/2013 (wallstreetpr) – AT&T Inc. (NYSE:T) is a leading telecoms operator in the U.S. The company is currently in the process of expanding its global network. The company was reported in October to be reaching out for Vodafone in a bid to takeover is Europe operations. Earlier before this, T was rumored to be joining hands with its U.S. rival Verizon Communication to buy Vodafone out of Europe, but that didn’t materialize. Instead, Verizon bought Vodafone out of Verizon Wireless.
Now AT&T Inc. (NYSE:T) is seeking a presence in Europe and Vodafone offers the best opportunity for penetration into the region. When the matter of Vodafone takeover was first reported, a section of T’s investors didn’t look impressed. The concern has always been the strict regulatory framework in EU. As such, this business environment is believed to be a high risk market for the U.S. carriers which are used to moderate regulatory policies.
But even of greater concern is the alleged U.S. surveillance. These allegations could make it hard for T to secure regulatory approval in such EU countries as Germany. There still exist suspicions towards U.S. telecoms operators in the eyes of foreign citizens and governments.
While EU is a promising market because of its presently low wireless penetration, AT&T Inc. (NYSE:T) is faced by several challenges, many of which it has no control over.
AT&T Inc. (NYSE:T) penetration of Europe will expand its revenue. This will also offer it diversified opportunity as the market’s wireless opportunities are largely untapped.
The twist in the company’s foray into EU through the U.K. carrier, Vodafone is that the latter is reported to be planning investment in landline communication which has the potential of putting off T.
There is still a lot of ground to be covered as the deal between the two giant operators. Save for the regulatory issues, AT&T Inc. (NYSE:T) will also need a deep pocket to by Vodafone out of Europe, these being one of the latter’s key markets. At the moment, it is a wait and see situation as the company’s CEO Randall Stephenson sweet-talks the board and investors in the deal.