AT&T buys T-Mobile USA for about $ 39 billion

NEW YORK (Reuters) - AT &T announced on Sunday the acquisition of T-Mobile USA with Deutsche Telekom for about $ 39 billion (27.5 billion euros) as part of a transaction in cash and stock.

This transaction, approved by the boards of both companies, will give birth to a new mobile phone giant in the U.S as it brought together two of the four largest actors in the country.

The cash portion of the transaction represents $ 25 billion, to be funded by new credit lines and existing cash.

AT&T adds that the right to increase the cash component of $ 4.1 billion.

Deutsche Telekom will receive shares of AT&T representing approximately 8% stake of U.S telecom operator and a representative of the German group will become part of the board of AT&T.

This may increase the cash element of its transaction subject to the participation of Deutsche Telekom remains above 5%.

The transaction should be finalized within 12 months and AT&T added that it would be accretive to its earnings per share during the third year following the completion.

AT&T also said that on a pro forma basis, the purchase of T-Mobile was to take the turnover of the mobile operations of AT & T's $ 58.5 billion to nearly $ 80 billion.

The fourth quarter 2010, sales of the first mobile operator in the U.S., Verizon Wireless, a joint venture between Verizon Communications and Vodafone, was 26.4 billion.

Deutsche Telekom said on his part that the proceeds of the sale of T-Mobile USA reduce its debt by some 13 billion euros, down 13%.

The German group also he would use five billion euros from the sale of T-Mobile USA to buy back shares.