T-Mobile's counter offer keeps alive a possible merger with Sprint; deal could be announced in weeks

T-Mobile's counter offer keeps alive a possible merger with Sprint; deal could be announced in weeks
It was just a few days ago when SoftBank, Sprint's majority owner, apparently pulled the plug on a merger with T-Mobile. At the time, both sides reportedly had agreed to the broad outline of a deal. The merged company would be majority owned by Deutsche Telekom (the company that owns the largest stake in T-Mobile), and T-Mobile president and CEO John Legere would run the combined carrier. But SoftBank apparently decided that it wanted to be majority owner after all, or have more say in the combined company than originally agreed to.

But the deal isn't dead yet. According to the Wall Street Journal, sources close to the talks say that T-Mobile has come up with a revised offer that could result in a merger announcement within weeks. Having said that, there still is the possibility that both sides still won't be able to come to terms on a deal.

After a T-Mobile board meeting in New York on Wednesday, president and CEO John Legere met with Sprint CEO Marcelo Claure. Legere's board voted to reopen talks with Sprint, mentioning that both Deutsche Telekom and T-Mobile didn't want the deal to die. Sprint held a board meeting of its own on Thursday with two major things to consider; how much of the combined company will SoftBank own, and the amount of influence that SoftBank CEO Masayoshi Son will have on the merged firm.

In calling off the talks last week, those familiar with his thinking said that Son did not want to give up control of Sprint, which he considers an important strategic asset for SoftBank. The executive believes that in the future, millions of devices including robots, will be connected to a cellular network.

In after hours trading on Thursday., Sprint rose over 5% to $6.77 after closing the regular trading day at $6.43. T-Mobile also shot up after hours, rising 1.73% after dropping 2.42% in regular trading. Sprint's current value is $25.7 billion, a bit more than half of T-Mobile's $50 billion market capitalization.  

source: WSJ

Recommended Stories

Loading Comments...
FCC OKs Cingular\'s purchase of AT&T Wireless