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Merger talks between T-Mobile and Sprint reportedly resume

t mobile sprint resume merger talks
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The on-again, off-again merger talks between T-Mobile and Sprint are reportedly on again, according to Bloomberg. Discussions between the U.S. carriers and their primary shareholders, Deutsche Telekom, which owns T-Mobile, and SoftBank, which owns Sprint, were put on hold for nearly a year until the Federal Communications Commission finalized its spectrum auction.

That auction finished on April 27, and executives from both SoftBank and Sprint confirmed to Bloomberg this week that they are now in contact with Deutsche Telekom and T-Mobile over a potential agreement. Back in 2014, Sprint had been angling to acquire T-Mobile, but ultimately abandoned the deal due to anti-trust regulatory pressure. AT&T’s attempt to buy T-Mobile back in 2011 failed for similar reasons.

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Now, it would appear that if a transaction were to go through, the tables have turned; it seems more likely that SoftBank would be looking to give Sprint up to Deustche Telekom. Back in November, Tim Hoettge, a chief executive from T-Mobile’s parent company, stated there was no interest internally about selling the “Un-carrier,” which now ranks third in subscribers behind Verizon and AT&T.

T-Mobile’s relative success over the past two years makes the proposition of a merger between the two last-place carriers a bit more interesting this time around. When discussions began in 2014, Sprint was in third, and T-Mobile was valued at $20 billion less than it is today. According to data from February, T-Mobile now claims roughly 10 million more customers than Sprint.

The other difference that could help move things along is the Trump administration’s more favorable attitude toward consolidation. SoftBank CEO Masayoshi Son has spoken openly about the difficulty of achieving similar deals under former President Barack Obama’s tenure. Son also received praise back in December from then-President Elect Donald Trump for pledging to bring 50,000 Sprint jobs to America.

T-Mobile and Sprint each saw their stock prices rise about 3 percent earlier in the week, in anticipation of resuming negotiations. But if SoftBank is unable to work out a deal with Deutsche Telekom, it might look to major players in the cable industry as Sprint’s savior. Back in April, media juggernaut Comcast and Charter Communications expressed interest in partnering with a wireless carrier to enter the market.

Still, Son has said a transaction with T-Mobile in some capacity remains his first choice.

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