WSJ: No rush for Sprint, T-Mobile merger announcement due to its public nature

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Yesterday we read that any announcement of a T-Mobile and Sprint merger could be pushed back to September so those involved had enough time to prepare a robust case to put forward to regulators. Today, Wall Street Journal reports that there are many reasons for the purported waiting game. 

In an enlightening article, it reveals code-names given to four parties and to the deal itself. “Project Oregon” – as it’s known on Wall Street – involves the Tiger (T-Mobile), the Swan (Sprint), the Hawk (SoftBank) and the Dove (Deutsche Telekom). It poses a question often on the lips of Wall Street bankers: 

“When will the Swan make a bid for the Tiger, giving the Hawk a stronger foothold in the U.S. market and providing the Dove its long-sought exit?”

Until today, the pseudonyms were the last remaining unknowns in the deal for SoftBank to take a controlling stake in T-Mobile US, and for Deutsche Telekom to reduce its U.S. footprint. We know the deal is worth around $40 per share, that there’s a break-up fee of around $2 billion, that $45B in financing has been secured and that T-Mobile’s current CEO, John Legere is the favorite to take over the merged company.

As for what’s taking so long, WSJ reports that it’s down to a few key points. Firstly, the deal is already very much in the public eye. Since we all know so much already, there’s no rush in announcing anything. Secondly – as we read yesterday – the companies are taking their time to ensure the plans are bullet-proof and to make them as attractive to regulators as possible. Thirdly, Deutsche Telekom’s chief mergers and acquisitions advisor is apparently taking a vacation, as is CEO Tim Höttges.

On the downside (or upside, depending on your persuasion), this delay also allows time for those who might oppose the deal to get their arguments “bullet-proof”.

Whatever the reasons, or the unknowns, I’m sure I’m not the only one who doesn’t care if it takes all year to sort. In fact, I know many of you are against the deal, despite the fact that there could be plusses to being part of a much larger carrier. The only thing that’s certain is that this isn’t the last we’ll hear of it.

Source: WSJ

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  • Fabian Cortez

    At the end of the day, it comes down to the following question: Is it in the best interest of the American consumer?

    The answer is “no.”

    • Nurdface Gamerhandz

      I dunno, if Legere and the tmo crew stay in charge it just might be. You’d get the uncarrier strategy and momentum, with enough low band spectrum to truly go nationwide with LTE. Especially if you were to shut down the poorly managed Sprint network and roll their nationwide 800 MHz spectrum from Nextel into a T-Mobile LTE(-A?) network….

      • Bilesha Welton

        How long can uncarrier last in a company that is tens of billions in debt?? Those banks are going to want to get paid, and prices will inevitably rise. This merger is a bad idea.

        • Drew

          I too think it’s a bad idea. T-Mobile US can manage on it’s own without any other merger being involved now!! :)

      • Justin747

        You’d get the uncarrier strategy and momentum, with enough low band spectrum to truly go nationwide with LTE EVENTUALLY

        Fixed that for you. Here is what people have to understand… This merger would take YEARS to complete. Also both companies would have a ridiculous amount of debt.

        The combined Sprint/T-Mobile would only compete with the Verizon and AT&T of today. Say this merger is finally fully completed in 2016, where will Verizon and AT&T be by then? They aren’t just gonna sit around and wait on T-Mobile/Sprint to catch up.

        Also, you expect Sprint to do all this work on the network then just shut it down instantly?

        • Nurdface Gamerhandz

          Look at what T-Mobile did/is doing with MetroPCS spectrum and how fast that merger is going and revise your statement. Also keep in mind that its not just the #3 and #4 carriers in the US merging on their own, Softbank is the vodafone or Verizon of Asia. The amount of up front capital Softbank would have to pour into the new T-Mobile (and it would be the new T-Mobile, Sprint’s name is toxic at this point, and CDMA is a dying technology) would be nothing compared to the long-term profitability of what could potentially be the #1 carrier in the largest established smartphone market in the world. Verizon paid $130 BILLION out of pocket to ensure they were the only ones making their profits. half that to propel T-Mobile to #1 would be the smartest business move Softbank could make. I would expect to see Sprint moved to be dismantled as soon as the ink dries on a merger, especially with VoLTE releasing. A simple software update to support the technology for any phone that isn’t EOL, and contract forgiveness for any phone that is, and T-Mobile could have a nationwide 800MHz LTE network in less than a year, and Sprint dismantled within a year after that.

        • Justin747

          Here is that weird logic AGAIN…

          What is with this weird fascination of T-Mobile being the #1 carrier? There are TONS of ways for T-Mobile to be successful without being #1. Stop using a Sports mentality with this. Again… That’s not how this works… That’s not how ANY of this works…

          So where are these magic wands you have that you can give SoftBank to work all this magic in 2 years? The T-Mobile/MetroPCS integration doesn’t mean that Sprint/T-Mobile will go through exactly the same way. Metro was the 6th largest carrier at merger. Sprint is 3rd.

          9 Millions vs 54 million

          Let’s just ignore network improvements for a sec. There is more to a merger that just making a mega network.

          There is:

          Marketing – Gotta teach people about the new company

          Layoffs & Store Closures – No need for multiple stores in close proximity.

          Remodeling – Stores that don’t close now have to be remodeled/rebranded to match the new company. New Uniforms for employees also

          Retail Training and Systems Integration – Sprint and T-Mobile use completely different retail systems. The system has to be combined and employees must be trained on new system. Expect lots of confusion and miscommunication from representatives during this time.

          Plan Changes and Policy Changes – They have to eliminate similar plans to decrease redundancy, which could potentially allow customers to break contracts. This also creates fragmentation due to holdovers. Some people don’t want a new fancy phone and a better plan. They just want what they already have.

          These are the things I saw working through the Sprint/Nextel bloodbath. All these things cost MILLIONS of dollars and took YEARS to even see progress.

        • Nurdface Gamerhandz

          There’s that “well sprint effed it up, T-Mobile will too because Sprint is a part of it” mentality. Look again at T-Mobile/MetroPCS to see how a wireless merger SHOULD go. I think you’re basing this on the assumption that Sprint is going to (mis)manage this merger, and also that its still 2005. I really don’t see this going the way of Sprint/Nextel simply because the team that would manage this merger has had such recent, modern experience folding a CDMA carrier into the T-Mobile portfolio on all fronts.

        • Justin747

          You are comparing T-Mobile merging with a mostly regional carrier of roughly 9 millions subscribers, to T-Mobile merging with a national carrier of roughly 54 million subscribers. Thats 6 times as many subscribers. SIX!!!!

          I’m purely basing my opinion of this not being good for CONSUMERS. We all lose here. And again, this would LITERALLY take YEARS. We would be lucky if the merger is fully complete by 2017. This doesn’t work like people think. People only look at it as if its about creating some kind of mega-super cellular network. It’s more to it than that.

  • hhjj

    Strongly oppose it. Any website signature to against this?

  • pops87

    If they keep the t-mo name, brand, and attractive pricing it may not be the worst thing in the world.

  • Maximus

    I’m starting to come around to the merger idea. Like others have said, if the TMO brand and business approach are maintained and it’s lead by Legere, I don’t see the harm. Essentially, Sprint disappears which I think no one would be disappointed about. We would be left with a bigger, stronger TMO that has more resources to compete with VZW and ATT.

    • notyourbusiness

      Sprint might disappear, but what about Softbank? They’ll be the ones truly in control. We don’t know that they won’t jack up prices, mess with people’s existing plans, etc.

      • Maximus

        I don’t think they would be in a position to do that. At least for a while. Sprint/TMO compete on price. That’s pretty much the reason people use them. They would really lose people if they raised prices right away. I would think they were smarter than that.

        • Justin747

          So you are OK with them raising prices, as long as they don’t do it right away?

          Prices are gonna raise. It’s inevitable simply because spending will increase. So you would have a combined company with a bunch of debt and a weaker network than the Big 2 attempting to charge similar or slightly cheaper prices.

        • xmiro

          true but that 800Mhz license Sprint has would obliterate the major gripe about T-Mobile’s network that keeps so many from switching over

      • Drew

        Yes Sprint is disappear. Softbank will merge Sprint into T-Mobile, forming a rebranded new company as Softbank Mobile US with all of T-Mobile US characterstics, from a post I had read recently a few days ago about such plan happening for both Sprint/ T-Mobile US to ever happen, once this merger gets approval from regulators/ fcc/ doj peoples.

    • Eric Youngdale

      I wouldn’t be disappointed if Sprint disappears, but if they succeed in buying out T-Mobile, I will be in the Verizon store on the day the deal closes.

      • DirkDigg1er

        And after the rep rings up that large bill, you’ll change your mind and come back home.

        • Eric Youngdale

          My wife is already on Verizon, so with the family plan it won’t be that bad.

          Besides – with the grief that Sprint put me through the last time, Verizon could charge me double and it would still be a bargain. You simply don’t understand how deep my loathing of Sprint is.

    • Justin747

      So basically you just want Sprint customers to become T-Mobile customers?

      Isn’t this happening already? Why merge?

      Also, this whole compete directly with Verizon and AT&T mentality is REALLY annoying…

      • Maximus

        Why? Companies fight for market share. That’s business.

        • Justin747

          Oh I’m sorry Mr CEO. I had no idea this whole debate was about business 101 instead of us as consumers.

          If you care more about what a company does vs what a company provides to you then I have no way of reasoning with you. That’s the definition of a fanboy.

          I still don’t get why people seem to think this is some sort of race. People are so against this merger because the CONSUMERS suffer. There won’t be a “Price War.” Stop buying into that corporate brainwashing

        • Maximus

          You are really naive if you think SoftBank, DT, Sprint, or TMO do what they do for “consumers”. They are interested in making money. Of course they have to keep consumers happy to make money, but making money nonetheless is what drives them. I am not a fanboy of any particular company or brand. Whatever suits my needs best is what I go for. And if you want to look at this from a consumer-friendly perspective, the merger is conducive to that. Although TMO looks great right now with all of their consumer-friendly initiatives, the reality is that they are bleeding money while VZW is laughing all the way to the bank. Why? Because TMO has to undercut on price to get customers so their margins are small if not negative right now. VZW can charge double and most won’t go anywhere because the service is good and won’t go through the hassle of switching. TMO knows this, they are not dumb. The merger would allow them the resources to really bring their network inline with the other two and start competing on service as well. I know TMO’s service has improved, but let’s face it, it’s not even close to the top two overall, despite faster speeds where there is coverage. That’s reality.

        • Justin747

          No nitwit. I’m not saying they do what they do for consumers.

          What I’m saying is it’s flat out STUPID for you to take the viewpoint of the COMPANY vs what happens with us CONSUMERS. If you aren’t a shareholder and you blindly defend an anti-consumer merger, you are a fanboy. No other explanation exists.

          TMO isn’t bleeding money. They are spending money to improve the network, and hopefully shut up the “EDGE” complainers in the process.

          Again with this weird “catch Verizon” logic. People like you seem to think Verizon is infallible. My work phone is Verizon. I can pull my phone out right now and barely get 2 mpbs on LTE. Stop acting like Verizon is perfect. Their network has issues just like everybody else. They just have more desolate areas covered than other carriers.

          This goes right back to my original point: Nobody is for this merger for the actual merger, people just want Sprint to become competent OR for Verizon/AT&T to struggle.

          Give me ONE benefit to this merger from a T-Mobile customers perspective. Keep in mind that this merger will take YEARS!!!! to complete.

        • Maximus

          If the merger is so bad for the TMO company and for TMO customers, why isn’t TMO themselves, including Legere, vehemently against it? Legere is actually supporting it. And yes, there are several benefits to TMO customers from the merger. One is the ability to keep expanding the network. Although TMO is on a role right with network improvements, it’s not sustainable. And yes, they are bleeding money. VZW and ATT work on their network and you don’t see them in the red. But when TMO does it we excuse it by saying their are working on their network. That’s hogwash. And I’m not saying VZW is not fallible, but a great many Americans are very happy with their VZW service and don’t care about saving $50 a month. They attract the people that aren’t necessarily price sensitive and need reliable service everywhere they go. TMO and Sprint attract relatively poor people that stay in their urban area and don’t travel much. This is an over-simplification, but it’s about right.

        • Justin747

          Legere and TMO are supporting because I’m sure their bank accounts will benefit greatly. That STILL doesn’t mean it’s a good idea for me, you, and the other people here. Have you not seen how Canada is with 3 major carriers?

          You say several benefits, but all you do is make a prediction about sustaining network improvements. How do you know It’s not sustainable? Do you have come kind of crystal ball that can see the future?

          And if it’s not sustainable, how does Sprint help? The same company who has been “almost finished” with the supposed greatest data network ever for the last 3 years?

          Poor people? Don’t travel much? Sooooo many baseless blanket statements…

        • Mike Palomba

          They are for the merger because T-Mobiles owner, Deutsche Telekom, wants to get out of the American Mobile Industry.

        • Mike Palomba

          Sprint and tmobile coverage is very similar and neither carriers coverage would help the other with rural coverage, its mostly overlap, so while they would be able to make urban coverage stronger their major problem still would not be solved. SO they would have more customers bogging down the network and all the customers from rural areas would still stick with Verizon and ATT.

      • xmiro

        one benefit T-Mobile gets from merging with Sprint is access to a near nationwide band of 800Mhz spectrum

        • Justin747

          When? And what T-Mobile phones currently support that band?

        • xmiro

          I’m only speculating but we could see T-Mobile phones with sprint LTE bands by the end of the year. and if the merger’s approved customers would be able to take advantage of the 800SMR band. And if the merger fails they could do a network joint venture easily.

        • Justin747

          Nah…

          Phones releasing at the end of the year have either completed planning and headed for production or are already in production. The only way this is possible is if manufacturers planned for this months ago.

          If this merger ever was to go through, don’t expect to see any real integration for at least 12 months, probably more. AT&T/Cingular took about 18 months to finish after the announcement. The Sprint/Nextel merger technically never finished completely.

          This is one of the many reasons I’m against it. I don’t think people realize how long this will take to complete. Also not ever person will stick around. People and business will leave the combined company if they even come remotely close to AT&T and Verizon prices.

        • xmiro

          I doubt T-Mobile would increase prices post merger. Not with the scrutiny that would be on them. And the longer they wait the more difficult it would be.

          But we don’t even know what kind of conditions will be attached by the Feds, if theythey would even have any interest in approving the merger.

          Network wise we are already seeing Sprint lower it’s capex 38%in Q2 this year so we can guesstimate which network is dying off. And once the T-Mobile team takes over there is no reason to expect them to move slower than they did with metro pcs. Particularly since I believe LTE on both networks is compatible sans phones having the required bands

        • Justin747

          They will eventually have no choice to increase prices to offset spending for the Super Network that everybody is predicting. Combining companies costs tons of money. From major things like Network Integration and Advertising to minor things like store remodels and employee uniforms. It’s tons of things to consider other than a POTENTIAL mega network.

          The problem is we as consumers have no leverage. If T-Mobile/Sprint DOES increase prices, what do we do as customers? Do we go to AT&T or Verizon? We no longer have any options since there is no 4th major carrier.

          I said this in another comment. They may move as fast as they did with Metro, but Metro was a REGIONAL carrier of only 9 million customers VS a NATIONAL carrier of 54 million. This isn’t the same type of merger. This is closer to AT&T/Cingular or Sprint/Nextel from a size stand point.

          You are making the same mistake as everybody else. Forget “defeating” the major 2. Forget this mythical Mega Network. How is less options better for us as consumers? Look at Canada if you want to see how 3 major carriers works.

  • Bilesha Welton

    Definitely against this deal. The only plus side would be T-Mobile obtaining 800MHz bands, but that point is moot since they’ll be able to gain a lot of 600MHz independently in next year’s auction anyway.

    • Drew

      I too am against this merger from ever trying to happen now. Go away Sprint

  • vinnyjr

    Against the Merger. If this thing is pushed thru I sure hope they eliminate the CDMA network, the worst 3G network in the world. If they can put all the GSM frequencies together and gain LTE frequencies and maintain the same data speeds then maybe just maybe it could work. I just don’t like the idea of Sprint throwing all their current customers on T-Mobile’s HSPA+ network, that will overload it and crash. I just dont like it at all, Sprint’s CDMA Network sucks, I wish T-Mobile, (Germany) would help their US branch and make the current T-Mobile a powerhouse like it could be.

    • Drew

      Oh my gosh please please please block this merger from happening at all. T-Mobile US can do manage well all by themselves independently now. Why cant the FCC/ DOJ just simply make an announcement for this merger to not go through at all. Sprint/ Softbank are very horrible people to deal with in the first place. The minute that this merger with Softbank/ Sprint merging T-Mobile US gets blocked is the day that all of us will be happy once again!! More money, more network upgrades/ advanced services!! :)

    • xmiro

      CDMA network will be gone over time. SoftBank customers in Japan are on the same GSM/LTE standard that T-Mobile operates

  • ” J.D. “

    ))) I THINK WE FOUND ANOTHER REASON ((( / If sprint has to pay a 3 billion break up fee and as of right now there bleeding customers rapidly as well as their stock around 7.50 per share How are they supposed to pay 8 different banks back their loans ? ? ( ANSWER THEIR NOT ! ) If the deal does not go through they pay what they can towards the breakup fee can’t pay any of the bank fees & now they have a reason to get a nice bankruptcy approval ( BLAME IT ON THE BREAKUP FEE PLUS THE BANK FEE’S ) To let them off the hook as well as free up all that low end spectrum while customers run for either T-Mobile Verizon or AT&T And the big 3 start bidding on all those empty towers and all that strung wire, as well as most going to T-Mobile they would have first preference cause of what their owed. They can’t just claim bankruptcy they need to prove their totally insolvent and have no cash flow, and the big numbers plus that break up fee proves that ! So the F.T.C. & the D.O.J. stamps APPROVED on this one ( I THINK THAT WAS THE PLAIN ALL ALONG ! )

  • kev2684

    wake me up when september ends

    • Drew

      Will do my friend. This merger is getting blocked. There is no way that this merger is going to happen at all guys. You guys are falling for the trap with what Softbank/ Sprint is trying to do towards its consumers there. Softbank/ Sprint will be getting suied/ will also go right out of business too. I freaking hate all guts of Softbank/ Sprint with a freaking passion. T-Mobile US is the truest way to go with, verses it being with AT&T/ Sprint. T-Mobile wins hands down.

    • http://mastermind777sblog.blogspot.com mastermind777

      I understood that reference.

    • randomnerd_number38

      The merger threats have come and passed,
      But Softbank says that Sprint can’t last
      Wake me up when September ends

      T-Mobile’s sub counts were in the trash
      But Legere turned it ’round so fast
      Wake me up when September ends

      Here comes the talk again
      That we’re gonna merge
      All the articles I see
      Give me the urge

      To punch Mr. Son right in his face
      Keep our uncarrier out of your disgrace
      Wake me up when September ends

  • Drew

    T-Mobile US can manage well all by themselves independently now. Why cant the FCC/ DOJ just simply make an announcement for this merger to not go through at all. Sprint/ Softbank are very horrible people to deal with in the first place. The minute that this merger with Softbank/ Sprint merging T-Mobile US gets blocked is the day that all of us will be happy once again!! More money, more network upgrades/ advanced services!! :)

    • http://mastermind777sblog.blogspot.com mastermind777

      The FCC/DOJ can’t just make an announcement. They have to seriously consider the situation and hear both sides, not react with pure emotional motivation.

      • Drew

        Bullcrap. They will see it blocked. Trust me dude. :) We will see what happens next. Blocked. Sprint go die right now please.

        • http://mastermind777sblog.blogspot.com mastermind777

          I mean, I also think that it won’t go through (anything could happen though, we’ll wait and see), but no governmental body is going to just decide that quickly. There are reasons for and against letting DT sell TMo to Softbank, so it’s not that clear-cut and certainly isn’t obvious at any level to a governmental body.

        • Drew

          Hey I figures that much my Dears sweet friend. Hey at least all of everyone including me/ you do believe at some point down the road, this merger thing will be getting Blocked once and for all. Like what me and you are saying now, we’ll just see what happens. Lets just please be sure to all keep all of our Fingers crossed on this whole merger deal to come about here’s sooner, and it getting BLOCKED. AHAHA. SPRINT YOU SMELL BAD, SO DO YOU SOFTBANK. LOL :)

  • S. Ali

    Good. I hope TMO moves forward with purchasing 700mhz nationwide and begin deploying. As of now, I don’t think they have any plans.

    • UMA_Fan

      I think the only reason they arent loud about 700mhz is that so many current devices don’t support it. They don’t want to cannabalize sales of devices now for devices that come out maybe months from now.

      • taron19119

        The reason t-mobile is not talking about the 700mhz band is because they had expected the approval of the purchase to go through at the end of q3 and it got approved way earlier than expected and don’t have phones ready to go the phones to use the 700mz bands is going to come out in q4

  • Jay Holm

    A company that is in the kind of shape Sprint is in, and has been for the past 7yrs shouldn’t be buying another company.

    • xmiro

      They won’t even be the surviving company, if all rumors pan out which they probably would since Legere has stated publicly on numerous occasions that T-Mobile brand will live on.

  • radar2670

    I REALLY hope T-Mobile is the one to survive. Right now I have their family plan with me and the wife at $120 a month with unlimited, no throttling, everything. Last month I used almost 12gigs(no usually THAT high but work WiFi was out for a week) and the wife used about 3gig. Yes their coverage is spotty but it is still the cheapest BY far. I have had no issues with their customer support but from what I have read, I am one of the lucky ones.

    • Halid

      I know what you are saying. And I feel the same way. Tmo is getting better and better I hope merger doesn’t go through.

  • Mike Palomba

    I just switched from Sprint because they’re truly the worst wireless carrier. I would rather go to trackfone then deal with Sprint. If Sprint and Tmobile merged I would switch to Att or Verizon the day of no matter the cost.

  • Mike Palomba

    Sign this petition to stop the merger please. Help all of us T-Mobile customers https://www.change.org/petitions/stop-sprint-from-taking-over-t-mobile-don-t-take-over-t-mobile

  • Richard Yarrell

    As i said back in November 2013 when first heard of this crazy plan it’s not happening at all Sprint better have a very good secondary plan cause Tmobile doesn’t need them to be successful.