T-Mobile and Sprint merger deal official

tmobilesprintmerger

After multiple rumors and leaks this month, T-Mobile and Sprint today confirmed that they’ve entered into a merger agreement.

According to the announcement that was just made, the combined company will simply be known as T-Mobile and will be headquartered at T-Mo’s current HQ in Bellevue, WA, with a second headquarters in Overland Park, KS, where Sprint is headquartered. T-Mobile parent company Deutsche Telekom will hold 42 percent ownership of the combined company while Sprint majority owner SoftBank will hold 27 percent. The remaining 31 percent will be held by the public.

T-Mobile CEO John Legere will serve as the CEO of the new T-Mobile while T-Mo COO Mike Sievert will be the President and COO of the combined T-Mobile-Sprint. Deutsche Telekom CEO Tim Höttges will be Chairman of the Board of the new T-Mobile, while SoftBank CEO Masayoshi Son and Sprint CEO Marcelo Claure will serve on the board.

The all-stock deal has a fixed exchange ratio of 0.10256 T-Mobile shares for each Sprint share. A report from Bloomberg notes that the deal is worth $26.5 billion and that there is no breakup fee attached to the deal.

This T-Mobile-Sprint merger is subject to closing conditions and regulatory approvals. The deal is expected to close no later than the first half of 2019.

T-Mobile and Sprint are using 5G to push their merger, even launching a 5GForAll.com website. “The new company will be able to light up a broad and deep 5G network faster than either company could separately,” the announcement claims. Using Sprint’s 2.5GHz spectrum, T-Mobile’s 600MHz airwaves, and other assets, the two companies claim that they’ll be able to create “the highest capacity mobile network in U.S. history” that, compared to T-Mobile’s current network, is expected to offer 15 times faster speeds on average nationwide by 2024.

The two companies also say that their merger will be good for U.S. job growth. The combined T-Mobile-Sprint will employ more than 200,000 people out of the gate, and the new T-Mobile intends to invest up to $40 billion in its network and business in the first three years. “This combination will also force AT&T, Charter, Comcast, Verizon, and others to make investments of their own to compete, driving billions more in accelerated investment,” the companies say.

T-Mobile also points to its acquisition of MetroPCS five years ago in support of its proposed merger with Sprint, saying that its MetroPCS acquisition brought “substantial job growth.” Three times the number of people work at MetroPCS now than there were working there when T-Mo acquired Metro in 2013.

T-Mobile and Sprint also say that their merger will create more competition. One of the major arguments against the merger will be that it’ll reduce the number of major U.S. carriers from 4 to 3, which will result in less competition and higher prices. T-Mo and Sprint don’t see it that way, though.

“This isn’t a case of going from 4 to 3 wireless companies – there are now at least 7 or 8 big competitors in this converging market. And in 5G, we’ll go from 0 to 1. Only the New T-Mobile will have the capacity to deliver real, nationwide 5G,” said T-Mobile CEO John Legere. “We’re confident that, once regulators see the compelling benefits, they’ll agree this is the right move at the right time for consumers and the country.”

marceloclaurejohnlegere

As I mentioned before, this deal will be subject to regulatory approval before it can actually move forward. There was some skepticism of last year’s attempted T-Mobile-Sprint merger, with one report saying that the U.S. Justice Department’s career staff would’ve recommended that the deal be halted. It remains to be seen how the current administration will respond to this deal, though.

Much of the arguments against this proposed merger will focus on how a combined T-Mobile-Sprint will result in a reduced number of major U.S. carriers, which could mean less competition and higher prices for consumers. T-Mo and Sprint know this, which is why Legere says that there are actually “at least 7 or 8 big competitors in this converging market”, like Comcast and Charter. T-Mobile has helped to make some big changes to the U.S. wireless industry in recent years with its Un-carrier moves, and there will be many concerns that this competitiveness will lessen without Sprint to push T-Mo.

Whatever happens with regulators this time around, the process is sure to take some time. What do you make of this news? Do you think that regulators will allow T-Mobile and Sprint to merge?

Sources: T-Mobile, Sprint, 5GForAll.com

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  • trickinit

    Oh boy.

  • Loco Mole

    Overland & Seattle cultures don’t mix well. Let’s see how this go

    Disclosure: was part of of Nextel when Sprint took over, and Overland’s culture was like (snake) oil on Nextel’s water.

    • sickofthepolitics

      Difference is T-Mobile is taking over. Their leadership and controlling interest win out.

      • Hurlamania

        Plus the people at sprint are all new, new owner, new manager

      • Loco Mole

        Sprint was bad as a taker, probably just as bad a taken. It’s 1960 work culture in Overland, KS. Good luck to the Seattle crew… they’re gonna need it.

  • The Borg

    This is going to be interesting

  • drupi79

    this’ll be an interesting ride. I worked for VoiceStream through the T-Mobile merger and hopefully this isn’t as rocky as that was…..

  • Sharti24

    If the FCC approves this how long before it becomes official?

    • Hurlamania

      It’s official technically just needs approval then it’s really official. So to speak. the deal is done

      • Sharti24

        Yeah they came to an agreement. I dont see it being denied by the FCC but i’m wondering how quick the transition will be to convert all Sprint customers to Tmobile

        • Hurlamania

          They want to convert all customers in under 3 years. They will convert some towers and spectrum way before that.

      • Jason

        The deal is not ‘done’. Not even close, the Justice Dept can block it (think AT&T merger and Time Warner), the FCC can block it, individual states can block it. The merger has been ANNOUNCED. Thats all

        • iCrap

          the difference is, att is already bigger than the combined tmo/sprint. they are massive. they are much, much bigger than the ma bell that was broken up in the 80’s because of their monopoly.

        • Hurlamania

          Apparently you can’t read, the deal is done between sprint and T-Mobile also I state it needs approval the be official.
          Remember the owner of sprint is friends with the president. He met with him during the transition. I think this is high for approval with this administration.
          Please try to read something and understand it prior to comments about it.

        • SirStephenH

          Yeah, but the AT&T/Time Warner deal was blocked because of Trump’s petty feud with the news media and Jeff Bezos. A T-Mobile/Sprint merger doesn’t have these “issues” and Trump and Son actually get along pretty well.

        • Cory

          This merger will not be blocked. It will not be blocked by the DOJ or the FCC. The chairman of the FCC has pretty much given the green light. The merger is as good as done. Saying this won’t be approved is like saying the Disney Fox deal won’t be approved. Two different arenas. But same logic.

    • Sean sorlie

      2019 would be my guess.

    • SirStephenH

      “This T-Mobile-Sprint merger is subject to closing conditions and regulatory approvals. The deal is expected to close no later than the first half of 2019.”
      ~Article Above

  • ltnstar

    after hearing the rumors for what 2,3 years. its like eh. Just as long as tmobile keeps full control on every aspect then we will be okay. And if this improves voice on tmobile then great. but we gotta keep in mind that, we wont see any of these benefits for at least over 2 years. since sprint uses a different tech for voice and is just introducing volte. A friend of mine just left them because there service got spotty where it was good. sprints excuse of still building towers, reminded me of when i was with them. so lets just cross our fingers

    • Hurlamania

      T-Mobile can use some spectrum and use sprint towers for there service until they convert all customers and convert everything.

    • SirStephenH

      They’ll start refarming spectrum immediately, keeping just enough of Sprint around to finish transistioning its customers to T-Mobile.

  • vplaza

    If Tmobile provides the leadership and direction, this might be okay. If sprint is given any meaningful say, it might not be. That said, might not be long before some price hikes if this is allowed.

    • Hurlamania

      They don’t have lower prices because of a almost bankrupt sprint they still have to compete. If they raise prices they would be equal to att and Verizon so people could go anywhere for the same price. It wouldn’t make sense. They make money now add 45 million more people and still try and get more from att and Verizon to become #1

  • Rob P

    Not sure if I like this yet tmos remains in controll?

    • Balthazar_B

      If you look at the percentage of equity in the new company each parent gets, T-Mo is firmly in control.

      • Rob P

        I seen it later in the day still wondering with only have 3 major carrier’s if prices will rise

    • SirStephenH

      I believe T-Mobile is supposed to retain 69% control over the combined company.

      • Rob P

        Thats good.sadly less options usually mean higher price

  • mikeZo6

    NO very bad Sprint network is useless ! cause look how Sprint is Now their not good at all !
    DOWN FALL of Tmobile just Started…

    • Balthazar_B

      Nah.

    • Hurlamania

      T-Mobile will convert sprint towers to T-Mobile towers sprint will be no more. This will create the largest wireless bandwidth company in history. T-mobile customers win and sprint customers get saves and become T-Mobile customers. Sprint is Dead…

  • Balthazar_B

    Will all the Sprint trolls, er, contributors who have participated for years in the Comments section of TMONews be keeping their jobs?

    • Fabian Cortez

      Inquiring minds would like to know.

  • Francisco Peña

    I’m okay with it provided two things occur. The first which seems to have happened, is that T-Mobile stays in control. The management of Sprint has ruined their company and no one has trust that they could lead this new company. The second thing is that T-Mobile actually takes advantage of the spectrum that Sprint has. Now maybe they can fill in the gaps of there Network and make it even stronger. I also hope that we get some good deals from this

  • Augustine

    T-Mobile does need more and better spectrum. Sprint has it, but apparently lacks the means and talent to succeed. Provided that Neville remains CTO and the Sprint CDMA network is wholly converted to LTE, it would be a blast to T-Mobile.

    However, even if this conversation happens and improves service in the mid term, for us customers it’s a loss in the long term.

    Unfortunately, because of Sprint’s choice of CDMA over GSM eons ago, a generous roaming agreement between both carriers would yield the same benefit to consumers without losing market competitiveness.

    PS: curiously enough, a couple of days ago in Baltimore I noticed that I was roaming on Sprint’s band 41 with VOLTE.

    • Hurlamania

      LTE is cross comparable T-Mobile can roam on sprints LTE immediately following sprint allowing it and they can do that at any point merger or not.

    • SirStephenH

      LTE is a single standard based on GSM and doesn’t suffer from the GSM/CDMA fragmentation of 2G and 3G.

  • pda96

    As a consumer, this potential merger sucks. But what I wouldn’t pay to see the faces of VZ’s and ATT’s CEOs. They know their days of dominance are OVER!

    • Balthazar_B

      Gonna be tough for Comcast, too.

      • Trulo911

        ALL cell phone companies Cell towers are back hauled by big cable Fiber (Comcast/Charter).. They make money regardless whether up front or on the backend…

    • iCrap

      why do yout hink it’ll suck? 5g home internet is in your future. no more being at the mercy of att, verizon, comcast, charter, etc.

  • Spanky

    I’ll be watching this very closely. Im an AT&T customer and the only reason I’m not on T-Mobile is because their coverage is still lacking. This merger may just encourage me to switch.

  • Sayahh

    What happens to Boost and Virgin now?

    • SirStephenH

      They’ll likely remain and be transitioned to T-Mobile’s network.

    • izick

      I’d say between Virgin, Boost, Metro, T-Mobile Prepaid, and Sprint Prepaid, I wouldn’t be surprised in the long run to see:

      Boost and MetroPCS to merge into a new brand or use one of the existing brands, given synergies.

      Virgin will be retired and/or rolled into the New T-Mobile’s Prepaid combined brand. However, the Virgin brand name is slowly dying in the North American market, and I wouldn’t be surprised to see it go the way of GoPhone.

    • Jamshaid Khan

      Like all other MVNO’s, Tracfone buys them…

    • squiggleslash

      They’ll have to transition to GSM/LTE. Otherwise I don’t see a problem.

  • jj201367

    Hmmm

  • Mark McCoskey

    Hope T-Mobile and Sprint can implement a Project Fi type of situation early on, fully utilizing LTE bands 2, 4, 12, 25, 26, 41, 66 and 71. This’ll be Project Fi, but with excellent phone choice. Win, win.

    • Balthazar_B

      For the customer, Project Fi is about NOT using mobile data if it can be avoided, given your bill is calculated almost entirely by how many MB of mobile data you consume. Kind of runs counter to how a carrier makes its money, don’tcha think? The (only) reason T-Mo and Sprint do business with Google is because the latter is paying them something for their excess capacity. And because Fi is a poke in the eye to AT&T, Comcast, and VzW, who seem to have in common that they’ve never seen a consumer they don’t want to exploit.

    • SirStephenH

      LTE is a single specification based on GSM unlike the GSM/CDMA debacle with 2G and 3G. Because of this there’s no reason why they can’t allow LTE roaming between both networks early on.

      Band 4’s days are likely numbered with it being a subset of band 66 and T-Mobile widely deploying band 66 and preferring connecting to it over band 4. The same would be true with band 2 which is a subset of band 25. It’s doubtful that T-Mobile would even want to mess around with Sprint’s tiny sliver of band 26 so they’d likely sell it to a smaller carrier. That leaves bands 12, 25, 41, 66, and 71.

      • vrm

        I think band 12 is the one to dispose of- both at&t and verizon may be happy to have it. Band 26 is nationwide and ALREADY deployed so it can serve as good upload band in a CA configuration.

        • macman37

          Dispose of Band 12!?! – T-Mobile’s 4G LTE Frequency that Verizon sold to them and told them to get as much of this as you can. Bad choice. Band 26 is yes nationwide with Sprint’s Network, but take a good look of how much good it’s doing them.

  • Gardo

    “New Jobs and lower prices” that had me ROTFLMAO good one John that has never ever happened after a merger I know their job is to sell this merger but the reality is that they are going to fire a lot of people and prices are going to go up.

    • onlineNetizen

      after TWC and Charter merged, I got downgraded from 300mpbs to 100mbps. I don’t see how this is beneficial to the consumer

      • Paul

        I went from 200mbps to only 70mbps on that merger!

        • onlineNetizen

          wow, that is terrible.

  • AJ2

    So sick and tired of Legere’s antics and claiming things are for the consumer. No , things are for profits. And getting rid of a major carrier will not be good for consumers long term. But with Trump and the GOP in office, this should go through

    • Balthazar_B

      Well, to be fair, it’s always about the customer. If you want to remain relevant and stay in business. Everything else in business is subservient to the customer. Legere is as customer-focused a CEO as there is. Nobody else in the telecomm space seems to have a clue, which is why their customers have been voting with their feet and moving to T-Mo over several years. If he wasn’t convinced this combination will serve customers better, it simply wouldn’t happen.

      EDIT: Since you mentioned profits, look at T-Mo before Legere was hired. Its attitude towards customers was neglectful and abysmal. The company was bleeding cash to the point it may not have been able to continue much longer. Could these have been related? Why do you think its fortunes changed?

  • barn fife

    If this is approved.. this combined company needs a new name!

  • SirStephenH

    “The two companies also say that their merger will be good for U.S. job growth. The combined T-Mobile-Sprint will employ more than 200,000 people out of the gate, and the new T-Mobile intends to invest up to $40 billion in its network and business in the first three years.”

    It will be good for jobs…in the short run. Once the three years are up and they’ve finished combining their networks, the investments will start drying up and nearly half of their combined stores will be closed down. Then, without the pressure of a fourth national carrier and with T-Mobile being on equal footing with Verizon and AT&T, there will be little reason to price service competitively.

    • Balthazar_B

      I have to believe their ambition is not limited to being a (bigger) dumb pipe, but to disrupt other markets (oh, hello Comcast). It’s possible Legere’s vision is not unlike that of Jeff Bezos. And of course they’ll continue to hammer on their dumber competitors in the carrier space by offering better value to consumers who can choose whose products and services they want to use.

      • CrimsonBlur

        There’s already wireless competition to landline, and 5G isn’t even out yet. There’s a company in my State that touts itself as such. Granted the pricing isn’t quite competitive enough yet, but I think what you said will ring true eventually…landlines should be sweating.

        • Trulo911

          ALL cell phone companies Cell towers are back hauled by big cable Fiber (Comcast/Charter).. They make money regardless whether up front or on the backend

        • CrimsonBlur

          Well, yeah, but I’m not talking about infrastructure. I was was strictly referring to consumer-level options for internet access. That’s a whole different sub-section of the market.

      • Melissa

        I think this is a great idea. I think Legere is onto something big. I’m for it.

      • Acdc1a

        The question is whether 5G will offer enough speed with enough users to justify the elimination of wired broadband. If it is, look out ComShaft, AT&T, and Verizon.

    • onlineNetizen

      they will then hire consultants to do synergy studies. the combined company will have a lot of debt. I can guarantee you that after three years, there will be layoffs

    • Reagan1

      Can you tell me this weekends winning lottery numbers?

  • ltnstar

    Finally the sprint brand is dead. Just wondering what sprint bands we can take advantage of with existing phones. I think we all need better in building penetration. Here’s hoping the sprint culture wont follow

  • Dan

    Boy, they’re trotting out the same old lies about job growth and lower prices. (Somehow, 7-8 competitors make a competitive market? How many ISPs out there and how come the individual rarely see any real competition for thier homes?)

    Job growth: Oh really? Their administrative/corporate side alone will be doubled up in staffing. That’s ignoring that they may have doubled up on field technicians and what have you. This WILL result in job losses because corporations aren’t people, compassion plays zero part in their decisions. People will lose jobs.

    Lower prices: Right… because that’s what is going on… lower prices. Reduced competition will even put less pressure to lower prices. So why do they… ugh… whatever.

    7-8 competitors? You mean the ‘competitors’ that are buying bandwidth from the main 3-4 wireless providers to provide their service? Those ‘extra competitors’ can be crushed without a second thought. Don’t fall for this doozy.

    • Gardo

      If this goes through I’ll be speaking with my wallet and I will take my 6 lines with me probably to AT&T even though I hate AT&T. The message has to be sent somehow.

      • Enrique Escobar

        as much as i’d like to “send a message” like you, i’ll just stick to T-Mo regardless of what happens, i can’t justify paying about 30% more just because they merge with the competition, as long as they let me keep paying what i’m currently paying, no point on changing carriers.

  • Philip

    It still have to go thru regulatory. Hopefully it is a no go!

  • onlineNetizen

    Recarrier finally happened.

    • Acdc1a

      Legere is a competitor. I don’t see that being the case.

      • onlineNetizen

        their slides say they expect margins of 50-60%. you don’t get those by being the uncarrier. I remember Legere complaining that big red and big blue had really big margins and they needed to be lower. now T-mobile wants the same margins as big red and big blue. this won’t help us as consumers

  • Carl Grimes

    Good for T-Mobile, and bad for consumers. In 2 years, T-Mobile will be just like the other 2.

    • Squidward Grumpy!

      Aren’t you supposed to be dead?

      • thepanttherlady

        *spoiler alert* LOL

  • PC_Tool

    Just waiting on the Legere/Claure bro-videos.

    At least we might get some mild entertainment out of the deal. :-/

  • Squidward Grumpy!

    All the wailing and gnashing of teeth. As I’ve said before, they don’t owe you crap. You don’t like the merger, move onto a competitor. This ” but muh lo lo prices” crap has gotta stop. That’s how capitalism works, and if it doesn’t, you elect the right people to make sure the right environment exists for it to self correct because people are the ones that pick the winners and losers, not the gubmint.

    • DannyMac

      Yup, at the end of the day, corporations do not have any loyalty to customers, it’s to the shareholders. The ultimate goal of a corporation is to earn the most amount of money while doing the least amount of work (and paying the least amount of taxes), but no one is going to throw money at any organization with no benefit to anyone aside from the shareholders. So, they have to provide a product or service. Depending on how much competition exists, they can provide poor products or they can go the extra mile to perform better than their competition.

      T-Mobile will gain a bunch of spectrum and have one less company to compete against. This means they can even increase prices or provide a poorer product which results in more dividends going to the shareholders.

      When companies merge, consumers are almost always the losers.

      • Squidward Grumpy!

        Does anyone know for sure this is what’ll happen? Legere is an ultra competitive guy, the combined company will still have less subs than the other two so the incentive to improve and compete is still there. Sprint is bleeding customers so it fits. If people don’t like the product, walk away.

        • DannyMac

          I didn’t say I don’t like the product. I don’t like the merger. I want more competition in this space, not less.

        • Ver

          Consider that Sprint might go bankrupt leaving 3 companies anyway. Better that T-Mobile should have it than either of the other 2. I don’t see much choice.

        • Wilfredo Martinez

          No one can prove that Sprint will go bankrupt! The same was said about T-Mobile back in 2011 when AT&T wanted to acquire it. Did T-Mobile go bankrupt after the merger was blocked? Nope!

      • Augustine

        I want to be paid the most for the least amount of work the possible as well. If you’d rather be working from sun to sun for minimum wage, knock yourself out. Otherwise, why do you criticize that other people running companies do the same?

        • DannyMac

          So you’d rather shoot yourself in the foot just so you can watch other people getting richer? This move is ultimately anti-consumer was my point.

      • TylerCameron

        I highly, HIGHLY doubt Sprint customers are the losers in this situation lol

    • samsung freud

      Why hello there John Legere!
      Nice of you to drop by and express your opinion!
      Just remember antitrust legislation and the break up of at&t while you, verizon, and at&t try and create a new monopoly.

      • Squidward Grumpy!

        Hi Samsung, I thought you said you weren’t going to psychoanalyze me any more.

    • Wilfredo Martinez

      There won’t be a competitor to T-Mobile after they gobble up fourth largest carrier Sprint.

      • Squidward Grumpy!

        There are some pretty smart, motivated, business savvy people out there, that can eventually push the big three. Heck, the MVNO’s have been known to undercut their benefactors from time to time.

  • The One

    I’m in favor of the merger, because the notion of 4 true competitors in the wireless industry is a fallacy. AT&T and Verizon are in a tier all to themselves, leaving TMO and Sprint to fight for scraps. That’s not competition. Give rural AT&T and Verizon customers a true third option and you’ll see prices decrease and service increase.

    • Wilfredo Martinez

      T-Mobile is expanding to rural America without Sprint. Your argument has no merit.

  • Not bad for a company that the other one called them ‘ghetto’ in a tasteless ad.

  • The Borg

    Regardless of whether your for or against, the regulators aren’t going to let this happen. Most say this has roughly a 40% chance of happening.

  • SirStephenH

    Yes, that’s ownership, but the discussion is about control. Those are two entirely different things.

  • Joe2050

    Regulatory approval is a matter of appealing to Mr. Dumphs ego and his patsy Pai, I’m sure they know they have a better chance with this laughing stock administration then the next one.

    I do hope this does not get approved but I wont be surprised if it does unfortunately…

    • TylerCameron

      Why do you hope it doesn’t get approved? Sprint made a HUGE mistake by betting on WiMAX almost 10 years ago and they STILL haven’t recovered from it. They’re a sinking ship and, from what I can see, there is irreparable damage to their brand. Which means that without the merger, within 5-10 years, Spring will no longer be a thing at all and they’ll just get bought up anyway. T-Mobile buying Sprint means T-Mobile gets their towers and spectrum. T-Mobile has shown that they know exactly how to use spectrum, even high band spectrum. And with the added customer base, T-Mobile has the power to totally dictate the direction of the industry. This is especially good for Sprint customers. They’re finally going to get the network they’ve been waiting for Sprint to build for nearly a decade. The only downside I see to this is there will almost certainly be thousands of jobs cut, which always sucks.. But this is a real win for the consumer.

      • macman37

        A Win for the consumer!?! How is that going to be? Less competition will lead to higher prices.

      • Wilfredo Martinez

        Prove to the DOJ that Sprint will go bankrupt.

    • macman37

      Back to a fight for the 3rd Largest U.S. Carrier when this fails and T-Mobile gives Sprint some spectrum.

  • steveb944

    Here we go again. Merger talk for the rest of the year.

  • macman37

    It’s really baffling how successful progression can really blind some people into making regretful mistakes. The only real winner here will be Sprint as they will be getting a good portion of the 600 Mhz Spectrum that T-Mobile recently won and really needed for nationwide coverage. Sprint just Roped-A- Dope the very same way that T-Mobile Roped-A-Dope with AT&T to get some of AT&T’s spectrum. Sprint already knows that this acquisition/merger will not go through; and are just waiting for the items that they and Legere wrote as part of a break-up deal. Really bad move John Legere!! Let’s just hope that you didn’t agree on giving Sprint enough of T-Mobile’s spectrum to where it’s a fight for 3rd place amongst the Big 4 Networks.

  • god this is so tiresome, if it wasn’t approaved before because of lowering the amount of carriers then why would it be any different now, John stated that Comcast and Charter are in the race but they aren’t, they don’t offer mobile phone services at least if they do somewhere its not across the country like Verizon, ATT, Sprint, and T-Mobile. Maybe if someone else got bigger in the game like US Cellular or someone this might would have worked.