US satellite TV giant DISH Network is talking to banks with a view to raising between USD10 billion and USD15 billion to help fund its desired acquisition of T-Mobile US, the Wall Street Journal (WSJ) has reported. According to unnamed sources familiar with the process, the satellite TV operator is working on a deal that would primarily consist of stock, but still needs to raise funds for the cash portion of the transaction. The source added that T-Mobile parent Deutsche Telekom (DT) and DISH are working on a transaction that would leave the German incumbent with a minority stake in a merged entity. Industry sources value T-Mobile at around USD31 billion, while DISH has a market value of roughly USD34 billion.
Last week the WSJ reported that merger talks between the two parties were at a ‘formative stage’, while noting that they had broadly agreed on the structure of the merged business. As such, DISH chief executive Charlie Ergen will reportedly assume the role of chairman and his T-Mobile counterpart John Legere will serve as the combined company’s CEO.
However, this week the New York Post reported that DT CEO Timotheus Hoettges is not interested in a merger between T-Mobile US and DISH, and would prefer a deal with long term suitor Sprint Corp, and ultimately a tie-up with cable giant Comcast. The CEO’s comments were made at the RBC Capital Markets conference in Toronto, Canada.