A report out of Reuters who quotes “people familiar with the matter” states T-Mobile and Sprint could be close to merging. A deal is reportedly being finalized and could be announced as soon as next month.
As for specifics surrounding the deal, T-Mobile’s parent company, Deutsche Telekom, would own a majority of the stake in the formed company, while Sprint’s parent, SoftBank, would own roughly 40 to 50 percent. T-Mobile CEO John Legere would lead the newly-established organization. Revenues would top $70 billion, the race to 5G networks would be assisted for both carriers, and together, the new company would have over 130 million subscribers already, just shy of what Verizon and AT&T currently have. We don’t know the value of this deal in dollars, but in terms of what comes afterward, things seem positive.
If you recall, a merger like this was rumored during the time of the Obama Administration. Back then, the FCC had worries and arguably went against a T-Mobile/Sprint merge since it may create market consolidation. However, under the Trump Administration, the FCC has essentially pulled a 180 on us and are much more open to changes like this. Therefore, if this deal does result to be true, it would probably be accepted by the FCC and pass. Of course, there’s always the possibility that this deal could fall through the floor, but at least for now, it looks like the third and fourth biggest US carriers could soon be one.
We expect more details surrounding the merger soon.