Sprint and T-Mobile US are putting the finishing touches on a stock-for-stock merger agreement that is likely to be announced when the mobile operators report their respective quarterly earnings at the end of October, people familiar with the matter have informed Bloomberg. Both parties are in the process of conducting final due diligence to decide on the exchange ratio that will determine Sprint’s valuation, the sources observed.
According to TeleGeography’s GlobalComms Database, back in June 2014 Sprint unveiled a USD32 billion (USD40 per share) offer for Deutsche Telekom (DT)-backed T-Mobile US. The deal, which would have seen the German company retain a roughly 15% to 20% stake in the combined company, was eventually abandoned by Sprint parent SoftBank, after a hostile reception from the US authorities.
It remains unclear as to how the combination would be viewed by the Trump Administration, although new Federal Communications Commission (FCC) chairman Ajit Pai is widely viewed as more ‘business-friendly’ than his predecessor, Tom Wheeler.