Sprint and T-Mobile Inch Closer to $32 Billion Merger

dgstorm

Editor in Chief
Staff member
Premium Member
Joined
Dec 30, 2010
Messages
10,992
Reaction score
3,961
Location
Austin, TX
T-mobile-Sprint.png

The next step in the proposed merger between T-Mobile and Sprint has commenced, bringing it ever closer to reality. The two companies have actually ironed out some details now. Sprint plans to pay T-Mobile $40 per share, in a 50% stock & 50% cash split deal later this summer. This would amount to a $32 Billion total cash price for the company, although Germany’s Deutsche Telekom AG, would still retain a 15% to 20% stake in the new company.

On top of this, the merger will also include a $1 billion+ (cash and other asset) break-up payment from Sprint to T-Mo if the deal falls through. This is similar to what happened when AT&T tried to buy T-Mobile in 2011. Of course, just like in that failed AT&T deal, even though this next big step has progressed forward in the process, that doesn't mean the deal will go through. There's still the huge hurdle of convincing the U.S. FCC and Department of Justice that this merger will be good for consumers and the market instead of harmful.

That's a pretty big hill to climb. In 2011, it was Sprint who supported the U.S. government's decision that the U.S. needed four carriers for the mobile industry to remain competitive. It seems a bit hypocritical of Sprint to now be arguing the opposite viewpoint. Of course, that is not an Apples to Oranges comparison. AT&T was/is already one of the two biggest forces in the mobile sector, whereas both Sprint and T-Mobile are much smaller and less successful. There is a compelling argument to be made that competition would be improved by having three strong competitors instead of two powerful ones and two weak ones.

What are your thoughts?

Source: WSJ
 

cr6

Super Moderator
Staff member
Joined
Apr 1, 2011
Messages
8,281
Reaction score
5,802
Location
NW Rocky Mtn region
Website
www.dronewolfmedia.com
Current Phone Model
Galaxy S7 Edge
Twitter
@dronewolfmedia
T-Mobile & Sprint combined will barely come close to the same coverage as Verizon, let alone taking a number of years to fully merge. Neither company has quality or widespread coverage where I live. I seriously doubt Verizon is worried much about this merge. I do however think it will be good for those customers on one of these two carriers, (eventually) so there's that.
 

cereal killer

Administrator
Staff member
Joined
Oct 29, 2009
Messages
11,254
Reaction score
1,269
Location
Austin, TX
Current Phone Model
Nokia Lumia Icon
I love how Sprint was all up in arms over the AT&T/T-Mo merger and now they are pushing for this one. Gotta love hypocrisy. The FCC and DOJ will shut this down I believe. Why? Same reason they shot down the AT&T/T-Mo merger.
 

Jeffrey

Premium Member
Premium Member
Joined
Jan 30, 2012
Messages
6,645
Reaction score
3,511
Location
Thailand
Current Phone Model
iPhone 7 Plus JB
I love how Sprint was all up in arms over the AT&T/T-Mo merger and now they are pushing for this one. Gotta love hypocrisy. The FCC and DOJ will shut this down I believe. Why? Same reason they shot down the AT&T/T-Mo merger.

Very true. Keep in mind Deutsche Bank is a major TMO stockholder and Softbank a major Sprint stockholder. If the transaction is done offshore, they can circumvent the FCC and DOJ.
I guess the question is, does a foreign owned entity need FCC and DOJ approval?
 

cereal killer

Administrator
Staff member
Joined
Oct 29, 2009
Messages
11,254
Reaction score
1,269
Location
Austin, TX
Current Phone Model
Nokia Lumia Icon
Very true. Keep in mind Deutsche Bank is a major TMO stockholder and Softbank a major Sprint stockholder. If the transaction is done offshore, they can circumvent the FCC and DOJ.
I guess the question is, does a foreign owned entity need FCC and DOJ approval?

Excellent point/observation. I would_think_yes if they plan to operate in the US.
 

Jeffrey

Premium Member
Premium Member
Joined
Jan 30, 2012
Messages
6,645
Reaction score
3,511
Location
Thailand
Current Phone Model
iPhone 7 Plus JB
The DOJ and FCC's concern is dropping to 3 major carriers which may force prices up. Personally, I don't think it will happen.

Softbank being the largest telecom in Japan needs this merger to offset their mobile losses in Japan. Voice/SMS communications have dropped considerably do to the free app Line.
 

blacksoxing

Active Member
Joined
Oct 1, 2010
Messages
256
Reaction score
26
Buckle up Verizon, you're going to be taken for a ride!

Two services that aren't known at all for their "quality" taking on VZ????

Dirt + Mud doesn't equal shine, son....someone who has VZ is someone who wants the "best", or has an unlimited plan. Else, VZ would have been deserted awhile ago!
 
Top