Judge Seeks More Data on 2 Telecom Deals
Arshad Mohammed, Staff Writer
Wednesday, July 26, 2006
A federal judge asked the Justice Department yesterday for
more information to help him decide whether to approve two
recent telecom mergers, an action analysts said could delay
AT&T Inc.'s $67 billion bid to buy BellSouth Corp.
U.S. District Court Judge Emmet G. Sullivan is reviewing SBC
Communications Corp.'s $16 billion acquisition of AT&T Corp.
and Verizon Communications Inc.'s $8.5 billion purchase of
MCI Inc. After SBC bought AT&T Corp. last year, it adopted
the name AT&T Inc.
While the AT&T and MCI deals have been completed, the judge
must review them to decide whether the conditions imposed on
them by the Justice Department are in the public interest.
Under a schedule laid out by the judge, the Justice
Department has until Aug. 7 to submit information.
Opponents may then comment until Aug. 17. The Justice
Department has to respond by Aug. 28.
Regulatory analysts said they saw little chance that the
judge would seek to undo the mergers, saying he might seek
some changes to the consent decrees under which SBC and
Verizon agreed to lease some of their high-capacity lines to
"While we do not believe the prior . . . deals will be
unwound, we believe the court's examination could have the
effect of slowing government reviews of the pending
AT&T-BellSouth deal," Blair Levin, a telecom analyst, wrote
in a report. The Justice Department is unlikely to complete
its review of that deal until it sees how the judge rules on
the earlier mergers, analysts said.
AT&T spokesman Michael Balmoris said the San Antonio company
thinks the judge will "ultimately agree that the consent
decree is in the public interest."
John Thorne, a senior vice president and deputy general
counsel at New York-based Verizon, said he was confident the
judge would not undo the Verizon-MCI merger or require
significant changes to the consent decree.