T-Mobile US and Sprint resume active merger talks

By:
James Pearce
Published on:

US reports claim Sprint-parent SoftBank and T-Mobile-owner Deutsche Telekom are back in talks over a tie-up of their US mobile operations

The on/off discussions over a merger between T-Mobile US and Sprint are back on, according to reports from the US.

The parent companies of both US mobile operations, Deutsche Telekom and SoftBank, have re-entered negotiations, though a deal is still “weeks away” according to a report from CNBC.

Citing sources close to the matter, the American news network said the chances of reaching a deal, in which Deutsche Telekom would emerge the majority shareholder, are not assured.

Rumours over a dalliance between the third and fourth US players have been long-running, with a deal close in 2015, only for SoftBank to pull the plug due to regulatory concerns. Since then, T-Mobile has surpassed Sprint in terms of customer numbers with latest estimates from Statista showing T‑Mobile US has a 16.8% share of the US subscriber base, while Sprint controls 12.8%.

Talks resumed earlier this year, with SoftBank CEO Masayoshi Son reportedly willing to offload Sprint entirely to Deutsche Telekom, though the latest reports claim an all stock deal is much more likely, with the Japanese firm emerging as a significant minority stakeholder.

A question over whether or not regulators would approve such a merger also remains unclear. Previous regulatory regimes said a deal, which will give the combined entity clout to compete directly with AT&T and Verizon, was unlikely to be rubber-stamped. However, President Donald Trump has spoken favourably of mergers and acquisitions.

CNBC notes that any merged entity would likely be led by current T-Mobile CEO John Legere, who has had an open war of words on Twitter with Sprint boos Marcelo Claure, although neither company has commented on a potential deal.