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

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

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53 Comments

1. Neo_Huang

Posts: 1067; Member since: Dec 06, 2013

Phew. John Legere will still be in charge.

3. Dr.Phil

Posts: 2361; Member since: Feb 14, 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: 3621; Member since: Jan 19, 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: 81; Member since: May 06, 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: 5993; Member since: Dec 22, 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: 620; Member since: Mar 13, 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: 2383; Member since: Jul 18, 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: 2458; Member since: Nov 28, 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: 5993; Member since: Dec 22, 2010

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

4. bugsbunny00

Posts: 2264; Member since: Jun 07, 2013

let legere run sprint and yuoll see results.

5. MartyK

Posts: 1043; Member since: Apr 11, 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: 1260; Member since: Jan 24, 2012

Not enough, imho... Sprint must be converted to GSM network like T-Mobile. Its not impossible. MetroPCS is one example...

52. ervman1

Posts: 15; Member since: Dec 01, 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 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.

6. mickeygosselin

Posts: 47; Member since: Dec 11, 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: 169; Member since: Jul 25, 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: 15; Member since: Oct 19, 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: 5993; Member since: Dec 22, 2010

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

19. snowgator

Posts: 3621; Member since: Jan 19, 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: 2478; Member since: May 06, 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: 221; Member since: Sep 10, 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.

8. retronig

Posts: 23; Member since: Nov 21, 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: 194; Member since: Dec 03, 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: Apr 16, 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: 23; Member since: Feb 05, 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: 15; Member since: Oct 19, 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: 1043; Member since: Sep 28, 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: 15; Member since: Oct 19, 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.

15. Elfmonster unregistered

Merger: 1a) The rich get richer.

50. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

1b) The customers get screwed harder.

* Some comments have been hidden, because they don't meet the discussions rules.

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