Inside sources say T-Mobile, Sprint merger talks have resumed

Although they are at a very preliminary level and informal in nature, inside sources says officials with both SoftBank Group and Sprint have contacted Deutsche Telekom, majority owner of T-Mobile, about a possible merger. The resumption of talks may have been triggered by an April 27th deadline passing that concluded a spectrum auction blackout period for participants to pursue deals. Investors were told this week by both SoftBank’s chairman Masayoshi Son and Deutsche Telekom’s CEO Tim Hoettges that they were open to the idea of a merger. Earlier this year T-Mobile’s John Legere indicated there was still interest on his part as well.

Word of a merger between Sprint and T-Mobile has been a recurring concept throughout recent years. The companies came very close to making it happen in 2014 until the Obama administration put a regulatory stop to any deal based on a desire to maintain at least four major carriers in the U.S. That landscape has certainly changed now that the Trump administration has taken over and is undoing many initiatives of the previous administration.

Another piece that has changed quite a bit over the years is the relative position and strength of the carriers involved. T-Mobile’s market value as grown from around $32 billion to $55 billion and the company moved into the #3 spot, jumping over Sprint. According to Deutsche Telekom’s Hoettges, T-Mobile is now seen as a “kingmaker asset” in the portfolio and is a key earnings and growth generator. Sprint may not represent an enticing target for T-Mobile considering their struggles to keep customers. Thrown into the mix could be Comcast and Charter, both of whom have indicated they want to get into the wireless market in the U.S. and may be interested in acquiring Sprint.

source: Bloomberg

About the Author: Jeff Causey

Raised in North Carolina, Jeff Causey is a licensed CPA in North Carolina. Jeff's past Android devices include an HTC EVO, a Samsung Note II, an LG G3, and a Motorola Moto X Pure Edition along with a Samsung Galaxy Tablet 10.1. He currently uses a Samsung Galaxy S8 and (very rarely) a Nexus 7 (2013). He is also using a Verizon-branded Motorola Moto Z Play Droid supplied by his job. Jeff used to have a pair of Google Glass and a Moto 360 Sport in his stable of gadgets. Unfortunately, his kids have all drunk the Apple Kool-Aid and have i-devices. Life at home often includes demonstrations of the superiority of his Android based devices. In his free time, Jeff is active an active runner usually training for his next marathon, owns a MINI Cooper, and plays Dungeons & Dragons. Jeff has three mostly grown kids and a golden retriever.

  • Jeena Bittenbender

    It would save Sprint, that’s for sure. Don’t know how that would affect all those employees in Overland Park.