Fitch puts AT&T on watch

Fitch Ratings said it placed on Rating Watch negative AT&T, Inc.'s long-term issuer default rating of A, senior unsecured debt rating of A, $5 billion four-year revolving credit facility rating of A, $3 billion 364-day revolving credit facility rating of A, short-term issuer default rating of F1 and commercial paper rating of F1.

Fitch also said it placed the ratings of AT&T's subsidiaries on Rating Watch negative.

The action reflects news that AT&T will acquire T-Mobile USA from Deutsche Telecom in a cash and stock transaction valued at $39 billion, Fitch said.

The cash portion of the transaction is $25 billion and will be financed with debt and cash on AT&T's balance sheet, the agency said.

The remaining consideration will consist of AT&T common equity, Fitch said.

The agency said it will assess the effect of the transaction on AT&T's credit profile and capital structure, financing for the cash portion of the transaction, the proposed synergies anticipated, integration costs and the company's future financial performance and prospective credit metrics.

Fitch also said it will consider the potentially challenging regulatory hurdles to the transaction.

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