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AT&T buying Leap Wireless? It could happen.
The latest acquisition rumor comes courtesy of Reuters, which reported yesterday that AT&T and Leap have been in talks over the past few months regarding a potential deal.
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Such a deal would give AT&T more spectrum — an asset it has been actively looking for since its deal with T-Mobile collapsed, as well as a decent base of prepaid customers. The report comes just days after Bloomberg reported that T-Mobile had considered buying MetroPCS. The speculation frenzy underscores the acquisitive posture of most of the wireless carriers, which are looking to bulk up their various spectrum positions at a time when most are facing potential capacity constraints.
Leap and AT&T both declined to comment to CNET.
T-Mobile CEO Phliipp Humm declined to comment on its reported interest in MetroPCS during a conference call yesterday. MetroPCS declined to comment to CNET.
As with the potential T-Mobile-MetroPCS combination, there are complications with a AT&T-Leap deal. Leap uses a different technology, called CDMA, than AT&T, and is more compatible with networks run by Verizon Wireless, Sprint Nextel, and MetroPCS.
It’s unclear whether AT&T and Leap are still in talks, Reuters reported. But the talks were apparently serious enough that Leap hired bankers to advise it on a potential deal.
AT&T has said that it is pursuing smaller deals for spectrum. And Leap is considerably smaller than T-Mobile.
The report comes shortly after Leap, which runs the Cricket Wireless prepaid brand, reported disappointing first-quarter results — typically a strong period for prepaid players. MetroPCS likewise posted disappointing results.
The smaller prepaid players, including Tracfone, are struggling because of the aggressive moves made by the larger national carriers. T-Mobile yesterday reported strong prepaid numbers through its Monthly 4G business, and Sprint’s showed strength at both its Virgin Mobile and Boost Mobile arms.
Updated as 12:24 p.m. PT: to include a response from Leap.
