T-Mobile, Sprint Merger Talks Reportedly Rekindled To Battle Verizon-AT&T Duopoly

Will they, or won't they? T-Mobile and Sprint have tried on two previous occasions to tie the knot in an effort to create a powerhouse wireless carrier to better compete with Verizon and AT&T. However, those two previous deals both crashed and burned leaving T-Mobile and Sprint to fend for themselves.

Now, both CNBC and the Wall Street Journal are confirming that T-Mobile and Sprint have restarted merger talks. It is not known who was the initiating party this time around, but Sprint is seemingly in dire straight these days as its bleeds customers and attempts to raise capital to build out its nationwide wireless network.

legere claure
T-Mobile CEO John Legere (L), Sprint CEO Marcelo Claure (R)

When the second deal fell through back in November 2017, Sprint shares cratered while T-Mobile held firm. Today, when news broke of a third attempt at a merger, Sprint shares soared over 20 percent, while T-Mobile shares rose around 7 percent. The market is definitely receptive to the idea of strong third-place wireless competitor comprised of T-Mobile and Sprint, and it would definitely give loud mouth CEO John Legere something to crow about if the merger were to somehow make it through this time around.

"The prospect of combining with Sprint has been compelling for a variety of reasons, including the potential to create significant benefits for consumers and value for shareholders,” said Legere back in November. “However, we have been clear all along that a deal with anyone will have to result in superior long-term value for T-Mobile’s shareholders compared to our outstanding stand-alone performance and track record.”

Germany telecommunications firm Deutsche Telekom owns 63 percent of T-Mobile, while Japan-based SoftBank owns an 85 percent interest in Sprint. The multinational tie-up with vastly different managing styles has twice complicated the marriage of the two companies. The failure of the second deal in November was reportedly due to an inability to come to an agreement on who would lead the company.

We don't have a dog in this race, but it seems undeniable that Legere, whose exuberant foul-mouthed commentary and a penchant for bashing rivals Verizon and AT&T, has managed to turn around T-Mobile's fortunes and offer attractive promotions that have helped increase its subscriber base. He seems like the perfect fit to continue leading the combined company.


Via:  CNBC
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