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SoftBank and Sprint tipped to buy T-Mobile in June; combined carrier to be run by Legere?

Posted: , by Alan F.

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SoftBank and Sprint tipped to buy T-Mobile in June; combined carrier to be run by Legere?
It has been awhile since we last heard anything on the long rumored Sprint acquisition of T-Mobile. Considering the disdain that U.S. regulators have shown for this deal, we figured that SoftBank and Sprint had given up. Throw in the aggressive pro-consumer moves made by T-Mobile, and we figured that Sprint didn't want to deal with a company that was shaking things up in the mobile industry. After all, Sprint CEO Dan Heese seems as buttoned down as they come, the complete opposite of Legere's outspoken nature.

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.

source: Bloomberg

53 Comments
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posted on 30 Apr 2014, 22:52 9

1. Neo_Huang (Posts: 1067; Member since: 06 Dec 2013)


Phew. John Legere will still be in charge.

posted on 30 Apr 2014, 22:56 5

3. Dr.Phil (Posts: 1325; 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.

posted on 01 May 2014, 03:11 2

18. snowgator (Posts: 3600; 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.

posted on 30 Apr 2014, 22:54 4

2. TechBlue (Posts: 80; 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

posted on 01 May 2014, 00:04 2

9. Droid_X_Doug (Posts: 5993; 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.

posted on 01 May 2014, 07:24 2

26. rallyguy (Posts: 620; 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.

posted on 01 May 2014, 20:35 1

48. roscuthiii (Posts: 2226; 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.)

posted on 01 May 2014, 11:33

38. corporateJP (Posts: 2431; 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.

posted on 01 May 2014, 20:00

47. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)


I just hope that T-Mo gets some $ and spectrum out of Son's exercise of arrogance.

posted on 30 Apr 2014, 22:58 9

4. bugsbunny00 (Posts: 2118; Member since: 07 Jun 2013)


let legere run sprint and yuoll see results.

posted on 30 Apr 2014, 23:04 3

5. MartyK (Posts: 846; 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.

posted on 01 May 2014, 02:47 8

17. kanagadeepan (Posts: 944; 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...

posted on 02 May 2014, 00:35 1

52. ervman1 (Posts: 14; 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)

posted on 01 May 2014, 06:16 1

24. alouden (unregistered)


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.

posted on 30 Apr 2014, 23:08 5

6. mickeygosselin (Posts: 43; 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

posted on 01 May 2014, 07:52 2

29. joe1blue (Posts: 169; 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

posted on 30 Apr 2014, 23:13 10

7. nycezwl (Posts: 11; 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.

posted on 01 May 2014, 00:05 3

10. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)


^^^This. And that is why the deal won't happen.

posted on 01 May 2014, 03:15 5

19. snowgator (Posts: 3600; 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.

posted on 01 May 2014, 03:50 5

21. Doakie (Posts: 2107; 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.

posted on 01 May 2014, 09:19 3

34. Jommick (Posts: 221; Member since: 10 Sep 2013)


Hello,
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.

posted on 30 Apr 2014, 23:44 7

8. retronig (Posts: 23; 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.

posted on 01 May 2014, 07:47 2

28. DonkeySauce (Posts: 194; 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.

posted on 01 May 2014, 22:56

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.

posted on 01 May 2014, 00:21 1

11. albie1937 (Posts: 20; 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.

posted on 01 May 2014, 00:33

12. nycezwl (Posts: 11; 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

posted on 01 May 2014, 00:33 1

13. Augustine (Posts: 1043; 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.

posted on 01 May 2014, 00:58

14. nycezwl (Posts: 11; 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.

posted on 01 May 2014, 01:38 2

15. Elfmonster (unregistered)


Merger: 1a) The rich get richer.

posted on 01 May 2014, 22:56

50. 0xFFFF (Posts: 3806; Member since: 16 Apr 2014)


1b) The customers get screwed harder.

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