Bloomberg: Sprint – T-Mobile merger approval could take up to a year

Bloomberg: Sprint – T-Mobile merger approval could take up to a year
As final details around the merging of US carrier Sprint with US un-carrier T-Mobile are being ironed out, Bloomberg reports that Japanese carrier SoftBank (Sprint owner) CEO, Masayoshi Son, is asking banks to commit financing for "a longer-than-usual amount of time", as those involved in the $32b deal expect "a lengthy approval process". According to people in the know, said process could stretch out to a full year after the merger's official announcement. Reportedly, the banks have given Softbank and Deutsche Telekom (T-Mobile owner) 18 months to secure the deal, otherwise they won't provide funding.

If the planned merger fails, regardless of reason, T-Mobile is eligible to receive $1 billion or more in break-up fees. AT&T, which attempted but was not allowed to take over T-Mobile in 2011, has done this exercise already. The merging effort, which was ultimately rejected by the FCC, made a difficult year for AT&T CEO Randal Stephenson, whose total compensation for the year marked an 18.5 drop due to the failed merger and other circumstances.

Masayoshi-sama would like the deal to move a little quicker.

Masayoshi-sama would like the deal to move a little quicker.

However, history doesn't seem to bother Masayoshi Son who's quite intent on acquiring T-Mobile, even though the regulation authorities remain in favor of the current four big competitors status-quo. Both SoftBank and Deutsche Telekom have acknowledged they are ready to take a possible FCC rejection to the court if they have to. But AT&T had the same fighting words before it backed down from a court case later in 2011.

None of the parties involved, such as the carriers themselves, the FCC, and financial behemoths Goldman Sachs, JPMorgan and Deutsche Bank have commented on the rumor at this time.

source: Bloomberg

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10 Comments

1. SuperAndroidEvo

Posts: 4888; Member since: Apr 15, 2011

I am sure it might move a bit more swiftly. Well I hope at least.

7. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Lawsuits take waaaay more than 18 months to conclude. First there is the dance of death that has to occur to have a basis (claimed injury) for filing a lawsuit. Then there is the lawsuit itself (don't forget time for appeals). Best case is 36 months, which is 2x the 18 month bank line availability period. Realistically, if this goes the lawsuit route, is 60 months. Which is a major reason why AT&T cut their losses and paid the break-up fee. This is looking dumber and dumber with each passing article.

2. TheMoltenD

Posts: 109; Member since: Jul 13, 2014

If its approved it will take a lot longer than a year to merge a CDMA network with a GSM one.

9. npaladin2000

Posts: 165; Member since: Nov 06, 2011

If they have any sense at all they're going to dump all but the AWS and the PCS licenses that they wont have to divest as part of the merger deal. SMR is of limited utility, and BRS is of limited range.

3. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

A debt-financed disaster in the making. It wouldn't surprise me if ATT/Verizon were secretly helping the process along. Even if the merger happens, the resulting company will be so weak and helpless that it will fall apart. And ATT/Verizon will be there to pick up the pieces.

8. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

I would be thinking that AT&T is doing everything they can to egg this disaster along. Nothing like having Sprint weakened even more from a failed acquisition. Sprint is losing customers each day to AT&T, VZW and T-Mo.

4. SupermanayrB

Posts: 1188; Member since: Mar 20, 2012

'...Sprint – T-Mobile merger approval could take up to an year' Is the Y silent?

5. Doakie

Posts: 2468; Member since: May 06, 2009

No. An Year is just like An Hero. http://knowyourmeme.com/memes/an-hero

6. ZayZay

Posts: 571; Member since: Feb 26, 2011

Oh English.

10. JunitoNH

Posts: 1946; Member since: Feb 15, 2012

Well, I can understand and appreciate that, they have to figure out which politicians hands they have to grease.

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