Sprint and T-Mobile are currently the third and fourth largest wireless providers in the US respectively. The acquisition of T-Mobile for $40 a share would pose a significant threat to the market leaders Verizon and AT&T.
From WSJ:
Both companies feel doing a deal now is critical for their long-term survival, people familiar with the matter have said. AT&T and Verizon control most of the industry's valuable wireless customers and profits. And while T-Mobile has had a good competitive run in the past year, reversing subscriber losses and taking customers from rivals, executives at both companies have said the best way to create meaningful competition over the long term would be to join forces.
Under the broad terms the deal would be roughly 50% cash and 50% stock, the people said. T-Mobile's largest shareholder, Germany's Deutsche Telekom AG, would retain a stake of 15% to 20% in the new company, the people said. Based on roughly $40 a share and T-Mobile's outstanding share count at the end of the first quarter, a deal would value the company at around $32 billion.
Thoughts Monkeys?
Wish I held onto my Sprint shares...
This has been rumored for a long time. Regulatory approval has always been the hurdle. More likely if the T/DTV deal clears.
Maybe now I'll finally have some fucking LTE.
I know. I could barely post this.
Maybe T-Mobile will improve by some osmosis-like mechanism.
Thoughts on who would run the new company? Legere in, Hesse out?
I hope T-Mobile gets better!
The Big three is all the rage nowadays.
I think the merger would be beneficial for consumers, as sprint/t-mo would continue to bring a different ball game that would challenge vz/t business models, but at a larger and more meaningful scale. US telecom industry needs some shaking up (so does internet and TV).
Also John Legere is the man.
I'm conflicted about this. Normally, I'd say this is an awful idea to continue consolidation. But in this case it actually might make sense because currently there is no possible way that either T-Mobile or Sprint alone can truly compete with the other two. This way, you get three big guys who duke it out for subscribers which should force them to either lower prices or change up their offerings/policies to keep subscribers.
That said, it's also really easy to see it going the total opposite way where Sprint/T-mobile lose the advantages they had on the big guys in customer service and unlimited data plans. Also, am I wrong or do Sprint and T-mobile run on different network technology?
You are right, the technical differences between sprint and tmo networks has been commonly cited as a weakness of the merger. Tmo is on GSM (SIM Card used) while Sprint is on CDMA (No SIM). Additionally, the frequencies they operate on are not too compatible. So consolidating and/or dual maintenance of these different networks is going to be difficult and take lots of time and money. Additionally, customers may be forced to switch to CDMA or GSM phones, depending which way they go, which might annoy and bleed subscribers and corporate customers.
I think that this deal is likely to recieve regulatory approval because it will only increase competition with AT&T and VZ. With that said, customers should receive some benefit with more competitive wireless pricing and T-mobile/sprint will have access to more cell towers to provide a better service. Do others agree with this?
Would there be stock jump on T-Mobile-Sprint merger? (Originally Posted: 10/10/2017)
I heard news, there would be possible a merge between T-Mobile and Sprint end of October, 2017. I wonder would there be a huge jump on Sprint stock, just like Amazon merge with whole food.
I am waiting for it.
Completely different transactions
Amazon acquisition of Whole Foods had no real rumors leading up to it and made an all cash (utilizing debt) offer at a significant premium to buyout the WF shareholders
Generally in a merger of equals there is not a huge premium paid and they are mostly all stock deals. Maybe some value is created through the markets perception of how the two entities will integrate (though again the rumor is already out there and the market is pricing all of this in as we speak).
Thanks, Well... I guess, I am holding it. I bought the Sprint when it was 8~ but right now it is ~7, I hope it would jump to 9. Then I will dump it.
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