Reports: Sprint, T-Mobile near accord for ~$40/share deal


Bloomberg reports Sprint (S) and T-Mobile USA (TMUS) are near an agreement for a deal that would value T-Mobile at ~$40/share. The WSJ is also reporting a ~$40/share price.

S +3.7% AH. TMUS +3.2% to $36.02 - a price that points to ongoing regulatory worries.

Sprint's offer will reportedly feature a 50-50 cash/stock split, and leave Deutsche Telekom (DTEGY), which currently owns 67% of T-Mobile, with a 15% stake in the combined company. Bloomberg's sources state an announcement could happen by July.

In addition, the carriers are reportedly close to agreeing on a breakup fee - Sprint and parent SoftBank (SFTBF) have reportedly been pushing for a smaller breakup fee for a deal that's bound to face tough DOJ/FCC scrutiny; T-Mobile and Deutsche Telekom have wanted a bigger one.

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Comments (3)
  • duhaus
    , contributor
    Comments (320) | Send Message
     
    Let's hope the regulators have a moment of clarity and realize their fascination with "four major telecom companies" really means two large telecoms and two little guys that are going to get stomped into oblivion if left on their own.
    4 Jun 2014, 09:30 PM Reply Like
  • VernonDozier
    , contributor
    Comments (16) | Send Message
     
    The issue as I see it, is that a combined AT&T/Sprint Tie-Up would create a value wedge where one Japanese company has more than double the spectrum than companies in the US who have the most customers.

     

    This presents a very interesting service offering challenge when it comes to ownership and access to US public airwave rights, and serviceability for both AT&T and Verizon customers, who pay more for their service, yet are still unable to offer "Unlimited" service like both Sprint and T-Mobile provide today.

     

    I imagine both AT&T and Verizon are looking at this proposed offer very carefully. They have the most to loose. Imagine taking your money out of AT&T and Verizon, sending it to the Japanese Stock Exchange to invest in Softbank.
    5 Jun 2014, 06:38 PM Reply Like
  • aryanmehr
    , contributor
    Comments (144) | Send Message
     
    Isn't this what American companies have done for decades?
    8 Jun 2014, 06:49 PM Reply Like
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