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Sprint/T-Mobile merger: will the “new” T-Mobile be able to conquer the US market?

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Sprint/T-Mobile merger: will the “new” T-Mobile be able to conquer the US market?
It seems that the merger deal between T-Mobile and Sprint has almost been concluded now. Reuters reports that the CEO of Deutsche Telekom, T-Mobile’s main owner, is planning to attack the valuation gap between them and AT&T and Verizon.

Last week, a New York judge dismissed a lawsuit trying to block the deal. Deutsche Telekom’s CEO, Timotheus Höttges, said in a news conference that he is confident the difference of around $120 billion of market value between AT&T and Verizon and T-Mobile doesn’t seem like an obstacle, impossible to overcome. He is positive they can try and successfully shrink the gap, given the fact that the three main US wireless carriers would have similar customer count of around 140 to 150 million.

If the deal is concluded, Germany's Deutsche Telekom would own 42% of T-Mobile and 67% voting stake. Höttges states that they now have the ambition to become America’s No.1 carrier, overtaking AT&T and Verizon.

However, the deal and the period preceding it were not without struggles - apparently, building a next-gen 5G network ended up being quite expensive, forcing Deutsche Telekom to cut its 2019 dividend back in November. Nevertheless, the German company managed to reduce its net debt by around $3 billion.

Overall, the merger deal seems almost confirmed. All we have left now is to see if the German company’s CEO will be able to realize his ambitions after, what he calls, “the biggest merger with a German company the US has ever seen”.

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