T-Mobile and Sprint's merger announcement to be delayed

T-Mobile and Sprint's merger announcement to be delayed
About a fortnight ago, Bloomberg reported that T-Mobile and Sprint are ironing out the final details of their potential merger, up to the point where they were discussing the exchange ratio that will determine Sprint's valuation, one of the last steps before the merger could be officially announced. They even got down to non-cash items, such as the location of the HQ that will shelter the leadership of the new entity resulting from the merger, and reports are swirling that a merger announcement in October is imminent.

Industry-watching shops, however, are increasingly skeptical that a Sprint/T-Mobile merger will pass easily by the anti-monopoly regulations, even with a big business and merger friendly administration in the White House. "We note that the Democrats’ ‘Better Deal’ agenda (unveiled in July 2017, targeted towards 2018 elections) highlights ongoing corporate consolidation as a threat to U.S. consumers, and proposes sharper scrutiny of potential deals," opined Matthew Niknam of Deutsche Bank.

Today, another report by Bloomberg confirms the regulatory bottleneck, and tips that an announcement may come a few weeks after Sprint and T-Mobile report their quarterly earnings next week, which would place it squarely into November. Needless to say, the carriers may delay the dates of the earnings result pressers, which would be a telltale sign that something big is coming down the pipe with the quarterly reports.

source: Bloomberg

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6 Comments

1. cdgoin

Posts: 614; Member since: Jul 28, 2010

3 strong companies is still competitive vs 2 strong, 1 medium and a weak one. Then there are the other carriers that ride the others towers ( Cricket, Virgin, etc.. etc.. ) So I dont see this as a issue. They should merge.

2. djcody

Posts: 221; Member since: Apr 17, 2013

No, they don't need merge. Behind Sprint seat big bank, they just don't want to spend money to get profit and want to go easy way. Not going happen. In such big country four carriers is must!

5. TeriusRose

Posts: 108; Member since: May 12, 2017

Yeah, no. That's a textbook example of an oligopoly. Look at the airline industry for example. On paper there are a good deal of choices, but in reality the big 4 control nearly all the traffic and they've used that position to insert random fees and price raises for years. You see the same thing in industry after industry here. I don't know why we got to the point where we're cool with this kind of thing now, and frankly it's only screwing us all.

3. Duncdawg26

Posts: 169; Member since: Jan 20, 2017

T-mobile and MetroPCS prices are already going up and they haven't even announced the merger. The number one reason prices have gone down and mobile is the most competative market around is because of T-mobile. The 2nd reason- Sprint. The one thing in consumers' favor in the deal is that Sprint and T-mobile's networks are nearly identical and identically bad (on the national level). The resulting network will still need to offer lower prices to offset a worse network compared to att and Verizon but only until they totally catch up, which a Sprint-T-mobile company run by T-mobile would be very well poised to do. Prices will slowly start to even out (even as they already have started to do) as coverage catches up until all three are about even and competition stalls.

4. JadeMoon

Posts: 145; Member since: Aug 12, 2012

As long as T-Mobile remains the seme of the two, I dont care. But dont let Sprint run the show please.

6. Eclectech

Posts: 342; Member since: May 01, 2013

It would take years to integrate Sprint and T-mobile's non-compatible networks. It would be a disruption to customers, forcing some to eventually buy new phones and would just be a headache, considering T-Mobile's customer service is not as good as Sprint's. As context..I'm a former Sprint customer and current T-Mobile customer.

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