T-Mobile and Sprint may announce a merger after all
The deal could be public before the end of April.
T-Mobile and Sprint have started and stopped merger talks so often that it's easy to become jaded about the whole thing, but it now looks like they're close to a deal -- no, for real this time. Sources talking to CNBC, Reuters and the Wall Street Journal have all insisted that the two carriers are close to finalizing a merger agreement that could be announced as soon as April 29th. The pact would reportedly value Sprint at $26 billion and would give T-Mobile's parent Deutsche Telekom a roughly 40 percent stake in the combined carrier. T-Mobile chief John Legere would run the combined entity.
Masayoshi Son, the chief of Sprint's parent company SoftBank, reportedly had a change of heart. He'd brought talks to a halt in November over concerns about valuation, but CNBC has heard that Son sees better prospects through lower corporate taxes and is keenly aware of how much it will cost Sprint to upgrade to 5G. The fiercer competition from newcomers to wireless, like Comcast, might also play a role.
The tipsters were quick to caution that things could still fall apart, and that's entirely believable when the two have abruptly broken off talks in the past. And even if they do announce a merger, there's no guarantee it'll clear legal hurdles. Remember, officials shot down AT&T's attempt to buy T-Mobile in 2011, and they may do the same for its would-be Time Warner acquisition. T-Mobile and Sprint are considerably smaller than both AT&T and its arch-rival Verizon, but regulators may still see this hurting wireless competition. That might have some merit -- we've seen T-Mobile and Sprint aggressively one-up each other's plans in the past, and a combined company wouldn't face that pressure.
