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SA News • Fri, Sep. 19
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Mon, Oct. 13, 1:26 PM
- France's Iliad (OTC:ILIAF) has abandoned its bid to acquire T-Mobile USA (TMUS -3.6%). T-Mobile has fallen sharply on the news.
- Bloomberg previously reported Iliad had set a mid-October deadline to up its initial (rejected) offer for T-Mobile, or walk away. Deutsche Telekom (OTCQX:DTEGY) was believed to be skeptical about Iliad's ability to run T-Mobile, and also nervous about selling one of its few growth assets.
- Update: Iliad says it abandoned its bid after Deutsche Telekom and certain T-Mobile board members "refused to entertain" an offer for a 67% stake (up from a prior 56.6%).
Thu, Oct. 2, 1:53 PM
- Sources tell Bloomberg Iliad's (OTC:ILIAF) revised offer for T-Mobile USA (TMUS +3%) would involve taking a "significantly larger stake" than its previous offer of 56.6%. However, its $33/share offer price would remain unchanged.
- Parent Deutsche Telekom (OTCQX:DTEGY), reportedly open to a $35/share deal, is said to be undecided on whether Iliad's revised offer would be adequate.
- Notably, Bloomberg adds Iliad has "had some success signing up financial partners to back its efforts." The company has reportedly discussed raising as much as $5B in stock and debt for an improved bid.
- T-Mobile has added to its gains, and is nearing $29.
- Earlier: Iliad reportedly prepping bigger offer for T-Mobile
Thu, Oct. 2, 1:21 PM
- Bloomberg reports Iliad (OTC:ILIAF) is prepping an offer that would involve the French carrier acquiring a larger T-Mobile USA (TMUS +1.4%) stake. Iliad previously made a rejected $33/share offer for a 56.6% stake.
- Iliad is believed to have set a mid-October deadline for upping its T-Mobile bid or walking away, and has made outreaches to P-E firms. T-Mobile parent Deutsche Telekom (OTCQX:DTEGY) is reportedly wary of Iliad's overtures.
- T-Mobile has caught a bid on the report. However, shares remain well below Iliad's original offer price.
Fri, Sep. 26, 4:00 PM
- Deutsche Telekom (OTCQX:DTEGY) is "preparing for the possibility" of keeping its T-Mobile USA (TMUS +1.4%) stake for at least another year if Iliad (OTC:ILIAF) fails to sufficiently improve its offer, sources tell Reuters.
- Iliad has reportedly set a mid-October deadline to improve its T-Mobile bid, after an initial $33/share offer for a 56.6% stake was rejected. Multiple reports have stated DT has its concerns about selling to to Iliad, especially given T-Mobile (unlike many of DT's European assets) is showing healthy growth.
- T-Mobile has dipped on the Reuters report, but is closing higher. Earlier today, Pac Crest argued T-Mobile should reject any offer below $40/share, given its recent performance. The firm added its retail checks indicated a pickup in switching activity (to T-Mobile) and termination fee reimbursements following the iPhone 6 launch.
Fri, Sep. 19, 6:30 PM
- Iliad (OTC:ILIAF) has set a mid-October deadline to either make a new T-Mobile USA (NYSE:TMUS) offer or walk away, Reuters reports. The French carrier is said to be talking with U.S. banks to help finance a higher bid.
- Reuters adds Iliad "faces resistance" from Deutsche Telekom (OTCQX:DTEGY), which would keep a minority T-Mobile stake under Iliad's proposed deal terms and is skeptical of the company's prospects in a market it currently has no presence in.
- Bloomberg reported earlier today Iliad was struggling to line up 3rd-party investors, and that DT's board was divided on whether it should "sell its only growing asset." Sources (within Iliad?) tell Reuters Iliad's management has "finished road shows to meet U.S. investors and is waiting to hear back from potential investors."
Fri, Sep. 19, 2:22 PM
- Iliad's (OTC:ILIAF) talks with KKR and other investment firms to make a joint bid for T-Mobile USA (TMUS -1%) haven't yet borne fruit, Bloomberg reports. The French carrier's $33/share bid for a 56.6% stake was shot down last month.
- Meanwhile, Deutsche Telekom (OTCQX:DTEGY), recently reported to be open to a $35/share offer for T-Mobile USA, is said to be split on whether it should "sell its only growing asset."
- Bloomberg adds Iliad has "discussed raising as much as $5 billion in additional debt and equity for a sweetened offer." Likely acting as a hurdle: T-Mobile, which has over $17B in debt, is investing heavily to build out its 4G network and grow its spectrum portfolio, and is sacrificing margins to gain share, isn't a conventional P-E target.
- Prior T-Mobile/Iliad coverage
Mon, Sep. 1, 7:18 AM
- Despite its first bid at T-Mobile USA (NYSE:TMUS) being rebuffed, Iliad (OTC:ILIAF) says it is continuing to pursue a 56.6% stake of the mobile operator, and may now even partner with private equity funds to raise its offer.
- Iliad previously offered a bid of $33/share, although T-Mobile USA called the offer "a very inadequate value proposition."
- A report from Bloomberg last week announced that parent Deutsche Telekom (OTCQX:DTEGY) is open to holding talks to sell T-Mobile USA for $35/share or more.
Thu, Aug. 28, 1:03 PM
- Bloomberg reports Deutsche Telekom (OTCQX:DTEGY) is open to holding talks to sell T-Mobile USA (TMUS +2.1%) at $35/share or more. T-Mobile has risen above $30 in response.
- DT owns 67% of T-Mobile USA. French carrier Iliad (OTC:ILIAF) has offered $33/share for a 56.6% stake in T-Mobile, a bid T-Mobile has dismissed as "very inadequate."
- Sprint was rumored to be prepping a $40/share bid before abandoning its plans due to regulatory opposition.
Wed, Aug. 13, 6:37 PM
- Iliad's (OTC:ILIAF) $33/share offer to buy a 56.6% stake in T-Mobile USA (TMUS -1.6%) is "very flattering," but also "a very inadequate value proposition," says T-Mobile CFO Braxton Carter.
- However, Carter, whose company just saw Sprint abandon its attempt to buy it (for now) due to FCC/DOJ opposition, suggests T-Mobile is open to a better offer. "I think rarely people come with their best bid to start."
- For the time being, Iliad insists there's no need for a higher offer - T-Mobile currently trades at $29.14. But the French carrier has been reported to be reaching out to potential investors to sweeten its bid.
- Dish Network (DISH +1%) is also viewed as a potential T-Mobile suitor. Dish is still trying to find a use for its spectrum assets, and Charlie Ergen has repeatedly suggested he's open to a T-Mobile merger. But there are doubts about Dish's ability to pull off a deal, given both Dish and T-Mobile have plenty of high-yield debt on their balance sheets.
Thu, Aug. 7, 5:36 AM
- T-Mobile USA's (NYSE:TMUS) parent, Deutsche Telekom (OTCQX:DTEGY), has confirmed that it currently has no offer for T-Mobile USA which would boost the No.4 U.S. telecom provider's position.
- "We have always said that we would be open to offers for T-Mobile US which would improve its position and that of its shareholders," announces Deutsche Telekom CEO Tim Hoettges. "At the moment we don't have an offer which fits those criteria."
Tue, Aug. 5, 6:58 PM
- The WSJ reports Sprint (NYSE:S) is abandoning its bid to acquire T-Mobile USA (NYSE:TMUS) due to excessive regulatory hurdles.
- There were already many doubts about the ability of a Sprint/T-Mobile deal to pass muster with regulators.
- If Sprint is out of the picture, the coast is clear for Iliad (OTC:ILIAF) to pursue T-Mobile, provided financing isn't an issue. There were multiple reports earlier today indicating T-Mobile is rejecting Iliad's initial $33/share offer for a 56.6% stake.
- TMUS -5.6% AH
- Related tickers: OTCQX:DTEGY, OTCPK:SFTBF
Tue, Aug. 5, 3:59 PM
- The WSJ reports T-Mobile USA (TMUS +0.8%) has rejected Iliad's (OTC:ILIAF) request for access to its books, and won't change its mind in the absence of a better bid. The FT reports a formal rejection of Iliad's $33/share offer for a 56.6% stake in T-Mobile could arrive tomorrow.
- As it is, Deutsche Telekom (OTCQX:DTEGY) was reported to have liked Sprint's (S -1.4%) offer better. Sprint and parent SoftBank (OTCPK:SFTBF) are rumored to be offering ~$40/share, but their bid also carries much more regulatory risk.
- Reuters reports Iliad is talking with investors for help in sweetening its offer. Sources state the carrier has engaged pay-TV providers Dish , Cox, and Charter, as well as infrastructure, pension, and sovereign wealth funds.
- The news service adds DT is (not surprisingly) skeptical about Iliad's claim a merger between a French carrier and a U.S. carrier will yield $10B in synergies.
Fri, Aug. 1, 4:20 PM
- "If two of the largest companies are able to bid as one combined entity in the auction, their combined resources may have the effect of suppressing meaningful competition," says the FCC in a blog post. The post outlines a proposal by chairman Tom Wheeler that bars carriers from jointly bidding in next year's huge low-frequency spectrum auctions.
- The WSJ reported two weeks ago Sprint (S +1.4%) and T-Mobile (TMUS +1.4%), each of whom have a dearth of low-frequency spectrum relative to AT&T and Verizon, plan to form a JV that would raise $10B to jointly bid in the auction. The funds would be obtained through a $45B financing package SoftBank is lining up for a Sprint/T-Mobile merger.
- "It’s certainly a hint that they are predisposed against a merger," says analyst Craig Moffett about the FCC's stance. Prospective T-Mobile acquirer Iliad (OTC:ILIAF) must be pleased.
Fri, Aug. 1, 4:08 AM| 5 Comments
Thu, Jul. 31, 3:58 PM
- Sources tell Bloomberg T-Mobile USA (TMUS +6.7%) parent Deutsche Telekom (OTCQX:DTEGY) views Iliad's (OTC:ILIAF) $33/share offer for a 56.6% stake in T-Mobile as less competitive than Sprint's (S -5.9%) bid, previously reported to be around $40/share.
- Though Iliad declares its bid values the T-Mobile shares it won't own at $40.50, that figure includes $10B worth of synergies the French carrier predicts a merger will yield. Sprint and SoftBank (OTCPK:SFTBF), of course, predict their offer would also yield major synergies.
- "Iliad is about a third of the size of T-Mobile US, and we don't think there would be synergies from the deal," says analyst Jonathan Chaplin. He adds a deal will be tough to finance without Iliad founder/majority shareholder Xavier Neil surrendering control.
- Nonetheless, T-Mobile has rallied to $33 on news of Iliad's bid, which is bound to face less FCC/DOJ scrutiny if accepted and successfully financed.
- The offer is overshadowing a solid Q2 report from T-Mobile. The carrier saw 1.5M net customer adds in Q2 (up from 1.3M in Q1), slightly more than Verizon's Q2 adds and well above AT&T and Sprint's. Branded postpaid net adds totaled 908K (579K phone adds), and branded prepaid net adds 102K. Service revenue rose 7.1% Y/Y.
Thu, Jul. 31, 1:02 PM
- France's Iliad (OTC:ILIAF) is offering $15B in cash for a 56.6% stake in T-Mobile USA (TMUS +7.3%) at a price of $33/share. Iliad values the remaining 43.4% at $40.50/share. Sprint (S -5.3%) has been reported to be planning a ~$40/share deal.
- Iliad says it has obtained financing from unnamed banks, and would also do a capital raise to help pay for the deal. One issue: Iliad has a current market cap of just $16B, less than T-Mobile's $24.8B and Sprint's $30.6B. Sprint has reportedly lined up a $40B+ debt package to finance a T-Mobile deal.
- A source tells the WSJ Iliad, which has upended the French mobile market with its aggressive pricing, views a T-Mobile merger as a "one-time opportunity to enter the world's-largest telecoms market."
- Iliad also thinks (perhaps with good reason, given FCC/DOJ remarks) regulators will be more comfortable with its bid than Sprint's, since Iliad has no U.S. presence.
- AT&T (T -2%) and Verizon (VZ -2.3%) have joined Sprint in selling off, as investors mull the possibility of a deal that would leave the number of nationwide U.S. carriers at 4. Concerns about Iliad's pricing history might also be weighing on shares.
- Related tickers: OTCPK:SFTBF, OTCQX:DTEGY
- Earlier: Iliad reportedly bids for T-Mobile USA
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