SoftBank and Sprint tipped to buy T-Mobile in June; combined carrier to be run by Legere?
According to a report published on Wednesday, Sprint CFO Joe Euteneuer and Treasurer Greg Block met with some big Wall Street banks (not the kind that give away toasters) to press ahead with financing of a Sprint purchase of T-Mobile. Six banks were asked to be ready to lend a rather large sum of money to the nation's third largest carrier so that it could buy the nation's fourth largest carrier. A bid could be made as soon as June.
While things are moving ahead on the financing part of the deal, SoftBank Chairman Masayoshi Son is said to be working on arguments to show the FCC and FTC just how necessary this acquisition is. What the two regulatory agencies fear is that with T-Mobile gone, a carrier that has been extremely pro-consumer would disappear. To counter that fear, T-Mobile CEO John Legere is supposedly at the top of the short list of executives that would run a combined Sprint-T-Mobile. And while some have grown tired of his antics, most still consider him to be a breath of fresh air in an industry that can get pretty staid at times.
For the record, 67% of T-Mobile is owned by Germany's Deutsche Telekom. Which ever firm gets this block of stock, gets T-Mobile. Sprint is 78% owned by Japan's SoftBank. The latest rumor is that Deutsche Telekom wants as much cash for its block of T-Mobile stock, as opposed to more paper like shares or bonds. Son has yet to decide how to proceed, but whatever debt is amassed by SoftBank to make this deal happen, would be added to the $8.7 billion owed by T-Mobile.
1. Neo_Huang (Posts: 990; Member since: 06 Dec 2013)
Phew. John Legere will still be in charge.
3. Dr.Phil (Posts: 954; Member since: 14 Feb 2011)
Not quite. It says "To counter that fear, T-Mobile CEO John Legere is supposedly at the top of the short list of executives that would run a combined Sprint-T-Mobile." While that means the chances of him being in charge are very good, it doesn't necessarily mean he has the job.
18. snowgator (Posts: 3335; Member since: 19 Jan 2011)
Or that they keep him there. Let's not forget, at this level any buy out of a CEO is one the comapny can afford. I think a year or two with Mr. Legere at the helm may be enough for a alpha male personality like Masayoshi Son unless huge results are shown.
2. TechBlue (Posts: 62; Member since: 06 May 2010)
The DOJ already made it clear that they are not keen on this deal . why is Son pushing this to death??? go away ..you are like gum on my shoe
9. Droid_X_Doug (Posts: 5981; Member since: 22 Dec 2010)
"…why is Son pushing this to death???"
Because he is full of himself?
Absent approval by the USDoJ and FCC, Son can line up all the financing he wants to. D-T can even sign a merger agreement. But without approval to do the deal, the deal won't get done. Hopefully there will be a big break-up fee clause in the merger agreement, so D-T/T-Mo get a bunch of $ and spectrum from Sprint.
26. rallyguy (Posts: 604; Member since: 13 Mar 2012)
I would think they have talked to those agencies and have been told what it would take for them to approve it. I could be wrong.
You act like government agencies are truly honest.
48. roscuthiii (Posts: 1887; Member since: 18 Jul 2010)
You could think that, but then you'd be overlooking the AT&T/T-Mobile merger that fell through... which then won T-Mo a large chunk of AT&T's cash. (And some assets too, if I recall correctly, in the form of spectrum.)
38. corporateJP (Posts: 2152; Member since: 28 Nov 2009)
Son is the kind of guy who does not take "no" for an answer.
I give him credit on his tenacity, but he's going to waste time and energy on the DOJ, the FCC, and the FTC. That effort would be better spent improving Sprint's awful network, because this buyout attempt will more than likely be shot down by one of the three, if not all, government entities.
47. Droid_X_Doug (Posts: 5981; Member since: 22 Dec 2010)
I just hope that T-Mo gets some $ and spectrum out of Son's exercise of arrogance.
4. bugsbunny00 (Posts: 1361; Member since: 07 Jun 2013)
let legere run sprint and yuoll see results.
5. MartyK (Posts: 729; Member since: 11 Apr 2012)
The should give their approval if Legere is Guarantee 10 years as SprinT mobile CEO..should be part of the deal.
17. kanagadeepan (Posts: 748; Member since: 24 Jan 2012)
Not enough, imho... Sprint must be converted to GSM network like T-Mobile. Its not impossible. MetroPCS is one example...
52. ervman1 (Posts: 13; Member since: 01 Dec 2011)
not true actually, yes they currently use different communication standards but looking towards 4G (LTE and beyond) the networks will be compatible. It's actually a great move, I have high hopes for this merger (as long as it's run more like t mobile and not sprint :P)
24. alouden (Posts: 234; Member since: 18 Oct 2011)
Would Legere at the helm mean that much if Mr. Son is still the man behind the scenes with the power? I am genuinely asking this.
6. mickeygosselin (Posts: 16; Member since: 11 Dec 2013)
I kinda hope the deal goes through, I think with the acquisition of T-Mobile, data coverage and speed would increase for me, I currently have Sprint, and many more possible scenarios of what Legere could do if given the job
29. joe1blue (Posts: 142; Member since: 25 Jul 2013)
I see the whole Nextel situation again with this merger please I hope this will not happen look at how prices were back then I'm not sure but I think Nextel was a little behind T-Mobile and prices were already better whenever you have more competitive players in the market the government let too many of these types of mergers happen already look at how big at&t and Verizon has gotten over the years this is not going to be good for the consumers
7. nycezwl (Posts: 8; Member since: 19 Oct 2011)
All of you should stop thinking about CEO's, executives or anyone on top. Once T-Mobile is gone I guarantee you that the prices will go up on your cell phone bills. Look what T-Mobile did in just 1 year. The whole industry did 180. Big boys Verizon and AT&T are following T-Mobile. I'm in cell phone business since 2001 and I promise you I have never seen so many changes happen in just 1 year. And this deal will never go through, it will never be approve by regulators.
10. Droid_X_Doug (Posts: 5981; Member since: 22 Dec 2010)
^^^This. And that is why the deal won't happen.
19. snowgator (Posts: 3335; Member since: 19 Jan 2011)
I just dropped my grandfathered AT&T plans for my family with the data associated for each line and grabbed the shared data family plan and it was 90.00 cheaper a month. My kids lines were upgraded in December, and at that time the shared data plans were about the same for less data. There is no doubt in my mind- zero- I owe a thank-you to T-Mobile for this.
21. Doakie (Posts: 1415; Member since: 06 May 2009)
No kidding. I had 4 lines with Sprint in September I was paying $200+tax for that plan which had a 18% corporate discount attached. We switched to AT&T to a 4 line 10 GB shared plan for $240+tax, Figured I'd rather pay more for a network that works. We even got subsidized phones. Then AT&T goes and offers a non subsidized plan. We switched to their new family 10 GB plan for $160+tax per month but we get no more subsidized phones. We just got 4 Note 3's in October for $199... Now we get the non subsidized pricing just because they're feeling nice?! AWESOME!! This isn't the AT&T of the past... T-Mobile has totally changed the way these carriers behave.
Oh and to those belly aching about having to pay full price for good phones; with the Nexus 5, Moto X, Moto G, and OnePlus One floating around I'm totally fine paying $160/month and just buying new unsubsidized flagship's.
34. Jommick (Posts: 213; Member since: 10 Sep 2013)
You can still purchase a subsidized phone if you'd like to, it would just cause a $25 increase in the bill per line. It's honestly where the 26- month installment plans that AT&T has come into play, where it can be about that 25/mo for a flagship without the $200 up front. I'd encourage you to run the numbers and see what you end up with, because it can be a better option for purchasing a device…unless you happen to have piles of cash lying around.
8. retronig (Posts: 21; Member since: 21 Nov 2013)
Why has Softbank not done anything to make sprint a better carrier???? Yet they wanna acquire Tmo???? Son needs to worry about the company he already purchased before adding another one. I bet if he did purchase it they wouldn't do anything like they have done with sprint. If anything sprint has become worse and the amount of people canceling service proves that. Son leave tmo alone and concern yourself about the company you already have.
28. DonkeySauce (Posts: 170; Member since: 03 Dec 2011)
What a lot of people don't realize is that Sprint's network has drastically improved in tons of areas all over the country, but there's still a lot of work to do. The big problem is overcoming the reputation caused by the years of below par network service. Sprint's network could turn into the absolute best overnight, but people would still be trashing it in these comments for a year or more because that's what they're used to. So improving the network is only half the battle, then word has to spread. With what I've seen coming around the bend and the progress made in certain markets, I am convinced that within a year, Sprint will have an incredible network on par or exceeding the quality of Verizon's, albeit a smaller rural footprint.
49. 0xFFFF (Posts: 3806; Member since: 16 Apr 2014)
There's some truth to what you are saying, but Sprint is still absolutely terrible in enough places where simple word-of-mouth advertising will doom them. People talk. And many of them say "Sprint sucks".
This is not to say that this will always be the case. But they seem to do things the dumbest hardest way most of the time. So there is no confidence in them.
11. albie1937 (Posts: 18; Member since: 05 Feb 2012)
Wall Street will get its way with this merger. Son has 5 top Wall Street banks ready. Those banks have lobbyists knee deep on Capitol Hill and best believe this merger will go thru. Too much money to be made with this merger and Wall Street is NOT GOING to let this slip thru their hands.
12. nycezwl (Posts: 8; Member since: 19 Oct 2011)
Don't forget AT&T & T-Mobile merger!!! oh yeah and 36 billions or was it more. This is not like a big corporation buying another corporation (usually people don't feel an effect
13. Augustine (Posts: 845; Member since: 28 Sep 2013)
You nailed it! The federal government and its 3-letter minions take orders from Wall St. We're done over; no more mister nice guy.
14. nycezwl (Posts: 8; Member since: 19 Oct 2011)
Sorry guys computer shut down! Don't forget AT&T & T-Mobile merger!!! oh yeah and 36 billions or was it more. This is not like a big corporation buying another corporation (usually people don't feel an effect). How do you think USA regulators are going to look at this "a foreign company is buying another telecommunications company" if I'm not mistaken their some laws about that.
16. zachattack (Posts: 603; Member since: 31 Jul 2013)
Phone arena always has the best ugly face pics of this guy, it's pretty hilarious
20. snowgator (Posts: 3335; Member since: 19 Jan 2011)
They always did with former Microsoft CEO Steve Ballmer as well. Man, these pictures are all about timing, ain't they?
22. alouden (Posts: 234; Member since: 18 Oct 2011)
So the fact that the FTC and FCC are against the deal makes no never mind to Mr. Son? I wish he would give it up. If the deal does happen I would have no choice but to leave. No one can convince me that after such a deal, the T-mobile I have grown to like will stay the same. There would have to be changes.
23. tigermcm (Posts: 806; Member since: 02 Sep 2009)
um the FCC and DOJ did not say flat out they would not approve that's why Son is still pursuing this
25. alouden (Posts: 234; Member since: 18 Oct 2011)
No, they are "highly skeptical" of such a deal. They like the idea of four major carriers and are worried about the landscapre that results when four are reduced to three.
40. corporateJP (Posts: 2152; Member since: 28 Nov 2009)
Dish could potentially help to change their minds on this, however, but it's a long shot.
27. uncfan44 (Posts: 8; Member since: 24 Apr 2013)
Few thoughts based on comments i've read. first someone said something about a foreign company buying tmo (if im understanding your point correctly). tmo is already owned in large by a foreign company so this is nothing new. to another point saying son has done nothing with sprint; thats not really true. service has gotten worse this is true, but it has to get worse in order for it to get better. the network upgrades are paying off, tho they are coming at a snails pace. customers are defecting at a large rate, but sprint knew this going into it. last quarter they had their best quarter in 7 years in terms of cash, so something is going well. im no sprint fan at all, actually love what tmo is doing and their CEO is hilarious, but with proper vision over the next couple years and they will be poised to make a splash. i am EXTREMELY in favor of a sprintmo company. they would finally have the purchasing power, when combined with softbank customers, to get good pricing on phones. also son is extremely hungry to become the worlds largest internet provider, and setting high goals usually isnt a bad thing. shoot for the moon and you'll at least end up in the stars. Hesse was a great turn around CEO, now we need Legere for growth!!! sorry post was long and jumped around haha
30. JunitoNH (Posts: 1081; Member since: 15 Feb 2012)
FCC should stop this merger, just as they did with the AT&T and T-Mobile. We need more competition, not less. Furthermore, since we are on the subject. Maybe is too late, but the merger between Comcast & TW, also should be stopped.
31. tokuzumi (Posts: 424; Member since: 27 Aug 2009)
Not sure how I feel about this. Maybe if the Sprint name disappeared, or changed altogether (kind of like EE, which was a joint venture between two other carriers). The name Sprint doesn't have a positive connotation. And the venture should do everything it can to kill off the CDMA network. While CDMA isn't a bad network tech, it's locked down to whatever phones manufacturers decide to make for them. Why not just switch over to GSM, and then Sprint customers will have access to whatever phone they want, instead of what I see on every phone message board "Will this phone come to my carrier?"
But, if Softbank wants to buy T-Mobile and absorb it into Sprint, this will be a failed venture.
53. thunder18 (Posts: 117; Member since: 06 Aug 2009)
CDMA vs. GSM will no longer be a factor if they can move to voice over LTE quickly.
32. medicci37 (Posts: 822; Member since: 19 Nov 2011)
Hey Son, focus on not being the worst major carrier out there & give consumers a reason to sign with Sprint.
33. medicci37 (Posts: 822; Member since: 19 Nov 2011)
& stop whining like a little bitch about how Sprint can't compete :'(
36. OldNorseBruin (Posts: 212; Member since: 12 Mar 2013)
FTC should NOT let this happen for the same reason SPRINT argued against the AT&T's ( wishful thinking!) buyout of T-MOBILE: "It'll KILL competition! "
SPRINT, go back to Kansas or your new home of WAR CRIMINAL Japan,; and figure out how to run a 3G network first!
37. youlookfoolish (Posts: 144; Member since: 14 Dec 2012)
T-Mobile added 1.3 million net postpaid customers in Q1 of 2014. Crushing Verizon, AT&T and Sprint together..
And still lost millions of dollars.
Passionate fan boys over marketing don't understand the business side where T-Mobile still can't turn a profit with customer adds. T-Mobile still has 7 million post paid customers less than Sprint!
The cheap and prepaid crowd don't make a business sustainable. Legere is a pop culture face. Great, it makes people passionate. But honestly I'd be terrified of him running Softbank's new combined company.
39. atlvideoguy (Posts: 46; Member since: 24 Feb 2012)
No merger, Sprint Should go after us cellular! I had Sprint for 2 1/2 years and they suck at coverage, data speeds, and customer service. Since switching to t-mobile I have not had dropped called at my house and I have had data speeds between 15-31mbps. Let dish network buy t-mobile before sprint and softbank.
42. phonetekmek (Posts: 70; Member since: 04 Oct 2013)
I am amoung the growing number who despises his antics. I will admit that he found a way to get people to not want subsidized phones. That is only good for the corporations. Customers are now paying full price for phones and people are happy about. Dumbest thing I've seen , but he managed to do it. Dan Hesse has led Sprint through all the mistakes of his predacessors and I think should be the head of the new company.
44. Augustine (Posts: 845; Member since: 28 Sep 2013)
Those who can't do math are quite happy with subsidized phones.
46. youlookfoolish (Posts: 144; Member since: 14 Dec 2012)
This is an asinine comment.
I can't stand Legere and think it's hilarious T-Mobile is losing money hand over fist even when adding subscribers (that are mostly prepaid.) but why should a service provider eat a subsidy and not offer the choice of a lower rate plan?
This is a similar attitude to ignorant consumers who walk into a service provider store and scream at the helpless ground level employee that the service provider sold them a bad phone. They don't have a clue about the difference between service provider and manufacturer.
Don't like prices on handsets but always want the newest tech? Blame the manufacturer you fool. The only one playing fair was Motorola and much like T-Mobile they keep getting sold or spun off.
43. mike2959 (Posts: 320; Member since: 08 Oct 2011)
Somehow we're all brain washed that we need to have multiple carrier's to have lower prices by thinking that competition always lowers prices, which is not true. Example, deregulation of the electric utility industry, the bill hasn't lowered! Really... The US has tons of carrier's anyways with MVNO, it's all BS...
51. 0xFFFF (Posts: 3806; Member since: 16 Apr 2014)
Reminds me that most loanshark paycheck lending places are now owned by the big banks. Everywhere you turn, you find the big boys running one scam or another...
45. skymitch89 (Posts: 1162; Member since: 05 Nov 2010)
If Softbank buys T-Mobile, that doesn't necessarily mean that Sprint & T-Mobile will become one company. Softbank could choose to keep the two companies separate (at least for now) and "rake in" the profits from both.