Sprint closer to obtaining financing for T-Mobile acquisition
Five major lenders, JP Morgan Chase & Co, Goldman Sachs Group, Deutsche Bank AG, Bank of America Merrill Lynch and Citigroup Inc, have agreed to finance the transaction. A trio of Japanese banks, Mizuho Financial Group Inc, Bank of Tokyo-Mitsubishi UFJ Ltd and Sumitomo Mitsui Financial Group, are also believed to be involved. SoftBank and Sprint are moving ahead, planning the transaction despite the odds that regulators will try to block the deal. According to those familiar with the transaction, the deal will be announced in August.
T-Mobile is owned by Deusche Telekom, and the German Telecommunications firm has apparently agreed to the broad outline of a deal that would pay T-Mobile stockholders $40 a share. That would value T-Mobile at $32 billion. If regulators block the transaction, Deutsche Telekom would receive a $2 billion break-up free from SoftBank. On the other hand, if Deutsche Telekom pulls out of the transaction, SoftBank will receive a $1 billion break-up fee from Deutsche Telekom.
There is speculation that if a deal is completed, T-Mobile CEO John Legere will be tapped to run the combined company.
1. QWIKSTRIKE (Posts: 924; Member since: 09 Mar 2010)
Financing won't matter if the deal is blocked. Greedy banks just want some of the action.
6. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)
Banks get a fee for making the line available regardless of whether it is actually used, so yes, win or lose, they get a piece of the action. Kind of how a break-up fee works.
I guess Son-boy is going to be writing T-Mo a check for $2 B. Probably around first part of 2015, would be my estimate.
13. lsutigers (Posts: 792; Member since: 08 Mar 2009)
You think you have it all figured out, don't you, Son-boy? Let's wait and see what actually happens instead of speculating. Recent info is that the FCC and DOJ may be willing consider the deal with all the other telecom merger proposals on the table. Nobody knows. Only time will tell.
17. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)
A bit defensive, there lsutigers? I can't help you if you bought into Son-boy's fairy tale about how a merger was the only way to compete against AT&T and VZW.
Unfortunately, no one else that matters (least of all DoJ; FCC staff is quite unimpressed with the pitch) is buying the fairy tale, so you are basically on your own.
Maybe cut your losses and sell?
21. jimmy954 (Posts: 7; Member since: 24 Dec 2013)
Hey TMO fanboy that seems to know it all....The key to this whole Sprint deal is what happens with comcast/TWC, if that goes through the DOJ will have to let the Sprint deal go through or they will just sue and win....simple case. so for everyone thinking its a dead deal, they need to be watching comcast/TWC.
No one seems to be really concerned with the FCC anymore, 5 member panel, 2 is already for it and a 3 has pretty much stated she has changed her mind. As I said the key is Comcast/TWC
25. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)
Hey Sprint fanboy who is trying to recoup their investment in Sprint - what makes you so sure that action in the cable space is going impact a merger attempt in the cellular space? Wishful thinking?
In the future, try harder to pick deals that have a reasonable chance of closing. Just because there are other M&A transactions on the table, doesn't mean they will close.
T-Mo may ultimately get sold to someone. It just won't be sold to Son-boy and Sprint.
23. fanesxx (Posts: 74; Member since: 19 May 2011)
am i the only one who thinks this is a bad idea
2. matty1323 (Posts: 29; Member since: 22 Nov 2011)
Now that is not fair at all!
"Deutsche Telekom would receive a $2 break-up free from SoftBank. On the other hand, if Deutsche Telekom pulls out of the transaction, SoftBank will receive a $1 billion break-up fee from Deutsche Telekom." Deutsche Telekom would get $2....2 Bucks while Softbank would get $1Billion? haha. Someone needs to edit that because we can't assume the $1 is 1B or 1M or what even though it's suspect.
3. mturby (unregistered)
Oh my god! please do something...against it.
4. 0xFFFF (Posts: 3806; Member since: 16 Apr 2014)
Sprint buying T-Mobile may turn out even worse than K-Mart buying Sears.
26. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)
Sprint sure screwed up the Nextel acquisition. What was it - a cool Billion $ down the toilet?
5. joe1blue (Posts: 149; Member since: 25 Jul 2013)
Sign the petition I'm not sure how it can effect on this matter but it doesn't hurt to try.
14. DonkeySauce (Posts: 171; Member since: 03 Dec 2011)
What will cause more job loss: The companies merging and laying off some duplicate positions, or one or both of them going bankrupt and then being bought by another company anyway, but at a bargain price and having a massive layoff?
7. fahrenheits (Posts: 3; Member since: 19 Jun 2014)
Well... at least the logo looks great lol
8. TheFirm (Posts: 33; Member since: 05 Jun 2014)
Lmfao, are your hyperlinks really ads? Really? Lmfaooo
9. jimmy954 (Posts: 7; Member since: 24 Dec 2013)
cant wait for the deal to go through so all these TMO fanboys can get off of it. Its funny how nobody is complaining about Comcast and Time Warner
19. volvoV70guy (Posts: 13; Member since: 06 Jun 2014)
Do you seriously think no one is complaning about Comcast and Time Warner Cable? That deal will almost certainly not happen, anyway.
20. jimmy954 (Posts: 7; Member since: 24 Dec 2013)
I haven't heard many people if any complaining about Time Warner deal, people don't realize that a bigger deal than Sprint and TMO lol. The key to this whole Sprint deal is what happens with comcast/TWO, if that goes through the DOJ will have to let the Sprint deal go through or they will just sue and win....simple case. so for everyone thinking its a dead deal, they need to be watching comcast/TWO
27. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)
Maybe you are hearing/sight impaired, which is why you haven't 'heard' people complain about Comcast/TW? Just because you haven't 'heard' something, doesn't mean an acquisition will happen.
You need to look at what is going to happen to market competition as a consequence of the proposed merger to see what its chances are of happening. The present crew at the DoJ really takes their job seriously.
10. fzacek (Posts: 2376; Member since: 26 Jan 2014)
$2 break-up fee if the deal is blocked? I think that's supposed to be $2 billion...
11. o0Exia0o (Posts: 450; Member since: 01 Feb 2013)
" If regulators block the transaction, Deutsche Telekom would receive a $2 break-up free from SoftBank."
If Sprint pulls out all they have to pay is a 2 dollar break up fee. For that much I would be all in too. LAMFO
12. Planterz (Posts: 1403; Member since: 30 Apr 2012)
Obviously a typo. I'm pretty sure they mean $2 billion.
And f%#K Sprint. Why the hell this company exists is beyond my understanging, and why they're behind T-Mobile is baffling. Granted, I know diddly about international finance, but it seems to me that Sprint is circling the drain, and T-Mobile is swimming to the top. Current net-worths seem to be the factor, although whomever decides that, IDFK.
Sprint sucks. This is a fact. Everybody who's done their research knows that Sprint sucks, and everybody I know that uses Sprint thinks it sucks, but uses it beacause they either have their head up their anus and won't change, are stuck on a contract, or use it because Sprint has some pretty cheap plans for people employed by companies that made deals with them for cheaper rates.
On paper, it'll look like Sprint wants to buy T-Mobile, But in reality, it'll be that Sprint knows they're in the latter stages of a turd being flushed down a toilet, and they need a company, like T-Mobile, to say #$%& YOU to the duolopy of Verizon/A&TT
Part of me wants this buyout/merger/whatever to succeed, so that an affordable alternative to AT&T/Verizon still exists, and with the power of 2 newtorks to support it. The other part hopes this fails, T-Mo gets a chunck of change to boost their network (and probably ends up surpassing, and possibly buying Spinrt), and rapes Verizon and AT&T with their "Uncarrier" strategy.
16. corporateJP (Posts: 2229; Member since: 28 Nov 2009)
"Sprint closer to obtaining financing to pay T-Mobile break-up fee"
28. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)
Or, Son-boy wants to stick Sprint with the cost of T-Mo merger break-up fee. Son-boy could write the check himself off of his gain from the Alibaba IPO. But he is too greedy. Better to stick the poor sods who bought into his fairy tale in the Sprint acquisition with the break-up fee - like jimmy954.
18. kevin91202 (Posts: 228; Member since: 08 Jun 2014)
Is PA an American website? It sure acts like it. I've read a lot of anti-Japanese or pro-European/American sentiment on PA. This article is not different.
"Five major lenders, JP Morgan Chase & Co, Goldman Sachs Group, Deutsche Bank AG, Bank of America Merrill Lynch and Citigroup Inc, have agreed to finance the transaction. A trio of Japanese banks, Mizuho Financial Group Inc, Bank of Tokyo-Mitsubishi UFJ Ltd and Sumitomo Mitsui Financial Group..."
The article names three "Japanese" banks, yet doesn't point out the nationality of the American and European banks. Why?
24. fjftokyo (Posts: 57; Member since: 06 Jun 2013)
the deal wont go through just like the attempt with AT&T. T-mobile will gain more juicy spectum from the break up and more money which they will actually use to beef up it's infrastructure again just like it did with AT&T which is great to anyone including myself who switched from another carrier to T-mobile. In mycase Sprint and trust me I couldn't leave them fast enough. For I shall never in a million years return to that sorry excuse of a cell phone company.
29. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)
"For I shall never in a million years return to that sorry excuse of a cell phone company."
You have a lot of company. Sprint is hemorrhaging customers, and mostly to T-Mo. Which is another reason why Son-boy wants to do the deal - he needs to get those indentured servants back in the Sprint fold.
30. navylostboy (Posts: 2; Member since: 25 Jul 2012)
i just love how the bashers of this deal seem to think that if it does not go through, that t-mobile will just keep on trucking. #1 t-mobiles parent company does not want to stay in the US market. they WANT to sell and have a seat on a board, not run one themselves. #2 without a merger the 3 and 4 comanies will fail, they cant generate enough money to grow properly and draw the income to be succesfull, the big 2 will continue to dominate.
So what is the plan? fight this deal and t-mobile dies, or gets sold to someone smaller, like dish. So what do you want?