SoftBank Group Corp intends to break off negotiations with Deutsche Telekom (DT) regarding a merger between their respective US subsidiaries, Sprint and T-Mobile US, after the two parties failed to agree terms regarding the prospective ownership of the combined entity. According to the Nikkei Asian Review, SoftBank is expected to approach DT today (31 October) to propose ending the talks. The report notes that the German firm has insisted on a controlling stake, and while SoftBank executives were initially amenable to the idea, the Japanese company’s board have now decided that they will not give up control.
As previously reported by TeleGeography’s CommsUpdate, the two parties entered into discussions over a stock-for-stock merger earlier this month. This is not the first time a merger between the two cellular operators has come unstuck; back in June 2014 Sprint unveiled a USD32 billion (USD40 per share) offer for 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.