AT&T in $39-million deal for T-Mobile

AT&T Inc. said yesterday it will buy T-Mobile USA from Deutsche Telekom AG in a cash-and-stock deal valued at $39 billion that would make it the largest cell phone company in the United States.

The deal would reduce the number of wireless carriers with national coverage from four to three, and is sure to face close regulatory scrutiny. It also removes a potential partner for Sprint Nextel Corp., the struggling No. 3 carrier, which had been in talks to combine with T-Mobile USA, according to Wall Street Journal reports.

AT&T is now the country's second-largest wireless carrier and T-Mobile USA is the fourth largest. The acquisition would give AT&T 129 million subscribers, vaulting it past Verizon Wireless to make it the largest U.S. cell phone company. The combined company would serve about 43 percent of U.S. cell phones.

For T-Mobile USA's 33.7 million subscribers, the news doesn't immediately change anything.

Because of the long regulatory process, AT&T expects the acquisition to take a year to close. But when and if it closes, T-Mobile USA customers would get access to AT&T's phone lineup, including the iPhone.