Mobile, Sprint call off merger attempt

Ken Copeland
November 5, 2017

In a joint statement, the third- (T-Mobile) and fourth-largest (Sprint) wireless carriers in the USA explained that they were unable to agree on the terms of a deal.

The companies issued a joint statement Saturday, after a week of speculation, saying they "have ceased talks".

"The prospect of combining with Sprint has been compelling for a variety of reasons", said T-Mobile President and CEO John Legere in a statement. But T-Mobile won't pursue a deal that doesn't "result in superior long-term value for T-Mobile's shareholders compared to our outstanding stand-alone performance and track record", he said. "However, we have agreed that it is best to move forward on our own", said Marcelo Claure, Sprint's CEO.

Germany's Deutsche Telekom (which own T-Mobile) and Japan's SoftBank (owners of Sprint) couldn't come to terms on who would control the combined companies so there was no way to go forward. Consumers are paying less for cellphone service, thanks to T-Mobile's influence on the industry and the resultant price wars. But Washington regulators have frowned on a possible merger.

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The previously proposed merger with T-Mobile was supposed to help both carriers fill gaps in coverage and increase their speed and capacity, along with allowing spectrum interlock to make 5G deployment across diversified solutions easier across the entire U.S. market.

"T-Mobile does not need a merger with Sprint to succeed, but Sprint might need one to survive", Piecyk wrote in an October research note.

T-Mobile, meanwhile, has provided Deutsche Telekom with growth at a time when the European market has been stagnant. Sprint hasn't had a profitable year in a decade, leaving a pile of credits from net operating losses that could benefit T-Mobile. Softbank CEO Masayoshi Son personally approached Charter about a merger, and talks at this point are reported to be strictly exploratory and preliminary in nature, but include a number of higher-ups from both companies. "We won't stop now".

Other reports by Guamnewswatch

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