T-Mobile: All Your Sprint Are Belong To Us

[Isgrimnur]

Reuters

U.S. wireless carrier T-Mobile US Inc is exploring taking over rival Sprint Corp in an all-stock deal, after SoftBank Group Corp offered to give up its majority ownership of Sprint, a person familiar with the matter said.

The latest negotiations come after Reuters reported earlier this year that Japan’s SoftBank was prepared to give up control of Sprint to clinch a merger with T-Mobile, and only retain a minority stake in the combined company.

Sprint and T-Mobile, which is controlled by Germany’s Deutsche Telekom AG, are still weeks away from an agreement, and have not settled on a share exchange ratio or even started performing due diligence on each other, the source added.

The companies have agreed, however, that John Legere, T-Mobile’s outspoken chief executive, would run the combined company should there be a deal, according to the source, who asked not to be identified discussing confidential negotiations.
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Sprint, which had earlier approached cable company Charter Communications Inc about a potential merger, has now put plans for a bid for Charter on the back burner as it focuses on negotiations with T-Mobile, the source said.

[Isgrimnur]

Or not

SoftBank Group plans to break off negotiations toward a merger between subsidiary Sprint and T-Mobile US amid a failure to come to terms on ownership of the combined entity, dashing the Japanese technology giant's hopes of reshaping the American wireless business.

SoftBank is expected to approach T-Mobile owner Deutsche Telekom as early as Tuesday to propose ending the talks. They had reached a broad agreement to integrate T-Mobile and Sprint -- the third- and fourth-largest carriers in the U.S. -- and were ironing out such details as the ownership ratio.

The German parent had insisted on a controlling stake, according to a source familiar with the situation. Some at SoftBank were initially amenable as long as the Japanese company retained some influence. But SoftBank's board discussed at a meeting Friday that the company would not give up control. The decision was made Monday to call the talks off.

[Moliere]

Sprint, T-Mobile set to announce a $26 billion merger

T-Mobile is closing in on a deal to merge with Sprint that will value Sprint near its current market price of $6.50 per share, according to people familiar with the matter.

The $26 billion deal could be announced as soon as Sunday, said the people, who asked not to be named because the negotiations are private. No deal has been signed and talks could still fall apart, said the people. The sides have agreed on an exact exchange ratio, although that figure couldn't immediately be determined.

SoftBank, which owns about 85 percent of Sprint, will allow Deutsche Telekom, which owns almost two-thirds of T-Mobile, to consolidate the new company's earnings, said the people.

A deal, if reached, would conclude several years of negotiations between the companies. Talks most recently broke off late last year after SoftBank CEO Masayoshi Son decided he didn't want to lose control of a combined company.

[Moliere]

What a combined T-Mobile and Sprint would look like

After two earlier attempts failed to materialize, T-Mobile and Sprint announced on Sunday that they’ve reached a $26.5 billion merger agreement. If approved, it would combine the third and fourth largest carriers in the United States. The new business would instantly become a much more formidable rival to Verizon and AT&T. Both companies claim that a successful merger would make the United States a leader in the formative early years of 5G mobile networks. But there are very legitimate concerns that shrinking the field of wireless competitors could end up hurting consumers and raising prices.

The deal must be cleared by regulators, including both the Federal Communications Commission and Justice Department, which is no small hurdle. FCC chairman Ajit Pai seems open to the idea, but many of the antitrust staffers at the DOJ today were the same people who convinced these two companies to abandon merger talks in 2014.

[Moliere]

T-Mobile CEO Checks Into Trump Hotel on Fence-Mending D.C. Mission

As he made the rounds of Washington to convince the Trump administration that his company should be permitted to buy Sprint Corp., T-Mobile US Inc. Chief Executive Officer John Legere chose the logical place to stay: the Trump International Hotel.

Twitter users posted pictures of Legere mugging with other visitors in the lobby of the hotel, which has become the place to stay for people currying favor with the government.

“It’s indicative of businesses’ approach to Washington, which is very pragmatic: I’ve got this deal I want to cut, and if I have to stay in the Trump hotel, I’ll do it,” said Meredith McGehee, executive director at Issue One, a policy group that promotes transparency and disclosure.

Collusion! Conflict of Interest! Er, or something?

[Kraken]

They will not run into opposition in Washington. This merger benefits the investing class. Screw consumers.

[Isgrimnur]

ars technica

T-Mobile and Sprint are one big step closer to getting the US government's approval to merge, as Federal Communications Commission Chairman Ajit Pai today announced his support for the deal combining two of the four largest US mobile carriers.

Pai's announcement virtually guarantees that the FCC will approve the deal; FCC approval would be finalized after the Republican-controlled commission votes. But T-Mobile and Sprint still need to convince the Department of Justice, which hasn't yet said whether it will sue to block the merger on antitrust grounds.

Pai's statement on the merger said he's approving it in large part because T-Mobile and Sprint "committed to deploying a 5G network that would cover 97 percent of our nation's population within three years of the closing of the merger and 99 percent of Americans within six years." They also committed to deploying 5G to 85 percent of rural Americans within three years and 90 percent within six years.

But as we wrote more than a year ago, T-Mobile and Sprint each said it would build a nationwide 5G network on its own before they agreed to merge. The companies made deploying 5G their key promise in the merger, even though all four major carriers were going to do that anyway.
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The merger would reduce competition by lowering the number of nationwide wireless carriers from four to three. But the FCC told reporters in a press call today that competition concerns were allayed by the companies' commitments not to raise prices for three years and to divest Boost Mobile, Sprint's prepaid wireless subsidiary that provides service to many low-income customers.

Boost is a reseller, so it will have to rely on access to the merged company's network, whereas currently it resells Sprint service. Under the merging companies' deal with the FCC, the commission will be able to approve or deny a new wholesale agreement T-Mobile is expected to strike with Boost.

[Isgrimnur]

DoJ Approval

The $26 billion merger between T-Mobile and Sprint secured final approval on Friday from the Department of Justice, where regulators blessed the combination of the country’s third- and fourth-largest wireless carriers after they agreed to sell off a critical portion of their business to Dish Network.
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To win DOJ’s blessings, T-Mobile and Sprint have agreed to sell wireless spectrum, telecom infrastructure and other assets to Dish, a satellite-television company that long harbored ambitions to become a national wireless carrier. The move is meant to satisfy regulators’ concerns that a combination of T-Mobile and Sprint, the country’s third- and fourth-largest wireless carriers, would limit consumers’ options for phone service. Absent those divestitures, DOJ officials said Wednesday that they would have sued to stop the deal, citing the fact it would harm competition and consumers.
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A federal judge must still approve the merger as must the Federal Communications Commission, though that agency’s Republican leaders previously expressed public support for the two wireless giant’s plans. T-Mobile and Sprint also must contend with the attorneys general of New York, California and other states, who sued in recent weeks to stop the deal, arguing it threatens competition and could result in consumers paying higher prices for their phone service.
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T-Mobile, which is operated by Germany’s Deutsche Telekom, and Sprint, which is owned by the Japanese conglomerate SoftBank, announced their $26.5 billion merger last April, describing the deal as necessary to deploy 5G, the next generation of ultra-fast wireless broadband service. Absent such a combination, T-Mobile and Sprint said they could not muster the necessary investments individually, putting them at a major disadvantage against AT&T and Verizon.

[Isgrimnur]

Approved

Shares of Sprint soared Tuesday after a U.S. District judge ruled in favor of its $26 billion deal to merge with T-Mobile.
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The ruling clears one of the final hurdles for the deal, which still can’t close until the California Public Utilities Commission approves the transaction.
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In his decision filed Tuesday, Judge Victor Marrero wrote, “The resulting stalemate leaves the Court lacking sufficiently impartial and objective ground on which to rely in basing a sound forecast of the likely competitive effects of a merger.”
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The judge laid out three points on which the court rejected the states’ objections to the merger. First, he said, they failed to convince the court that the merged party “would pursue anticompetitive behavior that, soon after the merger, directly or indirectly, will yield higher prices or lower quality for wireless telecommunications services.”

Second, the court rejected that Sprint would be able to continue operating effectively as a wireless services competitor without the merger.
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And finally, the court rejected the states’ argument that Dish “would not enter the wireless services market as a viable competitor nor live up to its commitments to build a national wireless network.”
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T-Mobile and Sprint agreed to certain concessions to the government before the agencies cleared the deal. The companies told the FCC they would deploy a 5G network covering 97% of the U.S. population within three years of closing the deal. Sprint also agreed to sell Boost Mobile, Virgin Mobile and other prepaid phone businesses, as well as some of its wireless spectrum to Dish Network for $5 billion before gaining approval from the Justice Department.

[Daveman]

I wonder if that Verizon "can you hear me now" guy will jump ship again and do ads for T-mobile now?

[ImLawBoy]

I wonder if that Verizon "can you hear me now" guy will jump ship again and do ads for T-mobile now?

That wouldn't be jumping ship. That would just be doing what the new owner asks.