Sprint, T-Mobile merger disconnected after negotiations fail

Despite the excitement a potential merger of Sprint and T-Mobile created, over the weekend the two sides announced that they had failed to reach an agreement on terms and determined it would be best for each company to continue on their own, individual paths. The deal would have created a wireless carrier large enough to rival AT&T and Verizon, but at the expense of a market comprised of at least four major carriers.

According to a statement issued by T-Mobile CEO John Legere, one of the requirements for T-Mobile was that any deal “will have to result in superior long-term value for T-Mobile’s shareholders.” Meanwhile, Sprint CEO Marcelo Claure stated, “we have agreed that it is best to move forward on our own….As convergence in the connectivity marketplace continues, we believe significant opportunities exist to establish strong partnerships across multiple industries.” Both statements were simple, to the point, and avoided going into any details regarding issues that may have derailed the talks.

Sources behind the scenes indicate a few issues seem to have become a source of contention, notably for Sprint and Softbank. Primary among those was reluctance on the part of Softbank CEO Masayoshi Son to give up control of Sprint to T-Mobile and Deutsche Telekom. Sources also say T-Mobile’s valuation of Sprint was too low for Sprint’s liking despite several months of a falling stock price. Finally, sources say Son thinks Sprint is a vital asset for Softbank that can yield significant benefits for the company beyond what would have been gained in a merger with T-Mobile.

sources: T-Mobile, Sprint
via: Mashable


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 Mazda MX-5 Miata, and plays Dungeons & Dragons. Jeff has three grown kids and a golden retriever.