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Failure of Sprint/T-Mobile Merger Means a Missed Chance To Save $30B (kansascity.com)
UPDATE (11/5/17): Sprint and T-Mobile confirmed Saturday that they've ended their merger talks, saying they were "unable to find mutually agreeable terms." The Kansas City Star reports that the failure "means shareholders of the two companies gave up $30 billion or more in cost savings that their managements had expected a merger to generate.
"One combined wireless company would have needed to invest less in its network than the two competing companies spend separately... Absent a merger, Sprint now faces a highly competitive marketplace as the smallest national player and with a more aggressive rival in T-Mobile."
Several news outlets had already reported on Monday that Japan's conglomerate SoftBank, which owns Sprint, has pulled the plug on a proposed merger between the two carriers. From a report: SoftBank will reportedly propose ending merger talks with T-Mobile parent company Deutsche Telekom as soon as Tuesday, October 31st. That's according to Nikkei, which says that SoftBank wants to end merger talks due to "a failure to agree on ownership of the combined entity." It's said that Deutsche Telekom insisted on a controlling stake of the combined T-Mobile-Sprint, and that some people at SoftBank were okay with that as long as SoftBank had some sort of influence. However, SoftBank's board recently decided that it wouldn't give up control, and today it decided that it wants to call off the merger talks.
Last Monday Sprint and T-Mobile shares both fell immediately following the media reports.
"One combined wireless company would have needed to invest less in its network than the two competing companies spend separately... Absent a merger, Sprint now faces a highly competitive marketplace as the smallest national player and with a more aggressive rival in T-Mobile."
Several news outlets had already reported on Monday that Japan's conglomerate SoftBank, which owns Sprint, has pulled the plug on a proposed merger between the two carriers. From a report: SoftBank will reportedly propose ending merger talks with T-Mobile parent company Deutsche Telekom as soon as Tuesday, October 31st. That's according to Nikkei, which says that SoftBank wants to end merger talks due to "a failure to agree on ownership of the combined entity." It's said that Deutsche Telekom insisted on a controlling stake of the combined T-Mobile-Sprint, and that some people at SoftBank were okay with that as long as SoftBank had some sort of influence. However, SoftBank's board recently decided that it wouldn't give up control, and today it decided that it wants to call off the merger talks.
Last Monday Sprint and T-Mobile shares both fell immediately following the media reports.
T-Mobile is not going anywhere. They already have a really nice network in most cities, they lack coverage in rural areas and in some markets but they still show a healthy growth.
on Sprint's part, about who the real loser in this pairing is.
Management/merger failures is how they got into the position they are now. Why the hell would T-Mobile, who have only been doing gangbusters-better the last five years, let Sprint take the wheel of the combined company?
First, T-Mobile just won a shit-ton of Spectrum in the 600MHz range, which will greatly improve both Coverage and Building penetration, so TMO service is only going to improve.
Second, a Merger between T-Mobile and Sprint would have a difficult time getting approval based on the AT&T / T-Mobile outcome.
Also,Mergers generally mean some Layoffs, so which an Administration focused on Job creation I see this as even more unlikely.