SoftBank to end Sprint and T-Mobile merger talks
SoftBank is said to be ending its dicussions with Deutsche Telekom about the merging of Sprint and T-Mobile US, over ownership disputes
SoftBank is rumoured to be ending talks between itself and Deutsche Telekom over the potential merging of Sprint and T-Mobile US.
Speaking exclusively to the Asian Review, sources close to the talks said that SoftBank is ending the discussions due to disputes over ownership of the combined company. They go on to say that the two had agreed a broader agreement on integrating its respective companies but that discussions reached a wall when ironing out the ownership ratios.
Deutsche Telekom are said to be asking for a controlling stake in the combined company and while some at SoftBank were initially happy with that agreement as long as they held some influence, SoftBank’s board has now met and they will not give up that control. The decision to call off the talks was made on Monday and SoftBank are rumoured to be approaching Deutsche Telekom at some point today (31 October 2017).
The merging of the two companies, is set to strengthen its position as the number three US mobile operator and Sprint's customer base enough to challenge AT&T and Verizon as real competition in the market.
As a result of the news trading in Tokyo showed that SoftBank shares fell to 9,830 yen ($86) down 5.8% from Monday's closing price. The share price had risen to 10,550 yen ($93) on Monday, a reported high for the company. The shares closed the morning session at 9,921 yen ($87), down 4.9%.
Commenting on the share prices, Tomoaki Kawasaki, senior analyst at Iwai Cosmo Securities, said: "Investors were buying SoftBank partially on the merger hopes, so the news has a negative impact. It will be difficult to maintain the stock price over the 10,000 level.”