Sprint and T-Mobile agree to all-stock merger deal worth $26 billion

Posted:
in AAPL Investors
The boards of directors for carriers Sprint and T-Mobile have approved a $26 billion deal to merge the two companies, with John Legere at the head of the combined company.

T-Mobile John Legere


The deal is the pair's third attempt to merge in as many years. If approved, Sprint, which has a market value of $26 billion, will merge with T-Mobile, which is worth around $55 billion. The pair have $60 billion of combined debt. The transaction values Sprint at 0.10256 shares per T-Mobile share.

I'm excited to announce that @TMobile & @Sprint
have reached an agreement to come together to form a new company - a larger, stronger competitor that will be a force for positive change for all US consumers and businesses! Watch this & click through for details.

— John Legere (@JohnLegere)
T-Mobile and Sprint are the nation's third- and fourth-largest wireless providers respectively. Combined, the two will have 127 million customers.

SoftBank owns 85 percent of Sprint. Deutsche Telekom owns about 60 percent of T-Mobile, and it will consolidate the combined entity's earnings.

Verizon has more than 150 million wireless customers. AT&T reported 144 million subscribers at the end of the last quarter.

The deal is not guaranteed to succeed. The U.S. government still has to approve the deal, with international agencies likely to weigh in as well. But, even if the deal falls through because of regulatory concerns, Sprint consumers will be allowed to use T-Mobile's network.
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Comments

  • Reply 1 of 32
    It'll be interesting to see how Team Telecom and CFIUS will rule on this. It won't be a cakewalk. I think that the shareholding structure of the merged entity may have to change drastically, with the combined ownership share of SB + DT forced to be less than 50%.
  • Reply 2 of 32
    Verizon: Make me an offer and I’m gone.
  • Reply 4 of 32
    How can a Sprint (CDMA) customer use T-Mobile’s (GSM) network?
  • Reply 5 of 32
    tallest skiltallest skil Posts: 43,399member
    How can a Sprint (CDMA) customer use T-Mobile’s (GSM) network?
    What’s most interesting is that each company uses four totally different LTE bands, so every single one of their customers is going to need a new phone (with 8 antennae) to be able to use the new network.
  • Reply 6 of 32
    dougddougd Posts: 218member
    I've been a satisfied TMO user for years. I get unlimited everything including tethering for a hundred bucks a month. I never get throttled either.

    As far as I am concerned this is great news, it just means better coverage in fringe areas
    exsangusjose_garciajbdragon
  • Reply 7 of 32
    How can a Sprint (CDMA) customer use T-Mobile’s (GSM) network?
    Perhaps I am wrong, but I thought that this was less of an issue with LTE? And even less so with 5G?

    Maybe the idea is that customers with older handsets will continue to live with the legacy network in their respective pre-merger entity, and will get the benefits of the new networks in the combined entity only if/when they upgrade their phones.
    edited April 2018 brian greenronn
  • Reply 8 of 32
    bonobobbonobob Posts: 153member
    How can a Sprint (CDMA) customer use T-Mobile’s (GSM) network?
    What’s most interesting is that each company uses four totally different LTE bands, so every single one of their customers is going to need a new phone (with 8 antennae) to be able to use the new network.
    Currently supported CDMA iPhones are fully capable of using GSM. I’m using my CDMA version right now on T-Mobile with no problems. I specficly chose this model because it can run on any if the big 4 in the US. 
    supadav03ronnGeorgeBMac
  • Reply 9 of 32
    How can a Sprint (CDMA) customer use T-Mobile’s (GSM) network?
    The TMO iPhone models support the 3 Sprint LTE bands (25, 26, and 41).  LTE is a shared technology, unlike GSM vs CDMA, so as long as a device supports the LTE bands, it should work regardless of the legacy technology base the carrier built out from.

    That being said, Sprint still uses CDMA as their voice side backbone.  (Disclaimer: I worked on the GSM side of the industry, so my CDMA knowledge is a bit limited).  After the merger they will likely phase out CDMA, use VoLTE anywhere that has LTE coverage, and move Sprint over to GSM fallback (i.e. HSPA / 3G).  In the meantime, there is no reason why TMO customers wouldn't get expanded LTE data coverage, and Sprint customers should have access to TMO's LTE network as well.  It will take several years for the network to work as a seamless single network, but all customers should benefit pretty quickly after (if) the merger is finalized.
    bonobobracerhomie3williamhAbove_The_Godsbrian greenGeorgeBMac
  • Reply 10 of 32
    How can a Sprint (CDMA) customer use T-Mobile’s (GSM) network?
    Easy, old CDMA users will be transitioned over to LTE / 5G in the next couple of years as most any new phone model has LTE built in now. Sprint Customers will be allowed to use T-Mobile LTE nodes in the interim.
  • Reply 11 of 32
    rob53rob53 Posts: 1,976member
    So, Sprint is owned by  Japanese company (80%) while T-Mobile is owned by a German company (60%). This means the combined company would still be foreign owned. I guess that doesn’t bother anyone since most US companies are majority-owned by companies outside the US. 
    cornchip
  • Reply 12 of 32
    As a Tmobile customer, hope for the best. Keeping 2 lines unlimited for $100 with expanded coverage would be nice.

    Curious if they merge, if they will start making new phones CDMA/GSM compatible until they can convert all towers to GSM. Either way, it is clear they want the combined network for easy 5G expansion, so they might not bother with legacy towers and only build upon the 4G/5G network.
  • Reply 13 of 32
    SpamSandwichSpamSandwich Posts: 30,581member
    How can a Sprint (CDMA) customer use T-Mobile’s (GSM) network?
    I think the plan for T-mobile is that they'll be upgrading all of their towers to 5G over time.
  • Reply 14 of 32
    SpamSandwichSpamSandwich Posts: 30,581member

    As a Tmobile customer, hope for the best. Keeping 2 lines unlimited for $100 with expanded coverage would be nice.

    Curious if they merge, if they will start making new phones CDMA/GSM compatible until they can convert all towers to GSM. Either way, it is clear they want the combined network for easy 5G expansion, so they might not bother with legacy towers and only build upon the 4G/5G network.
    Depends what are the costs to convert older towers to 5G, I suppose. I doubt they'd want to "shut down" any of the towers since a lot of those towers are locked into very long term land leases.
    curtis hannah
  • Reply 15 of 32
    bulk001bulk001 Posts: 438member
    Bloomberg has (very) different subscriber numbers for Verizon and AT&T:

    Operating as T-Mobile, the company would have about $74 billion in annual revenue and 70 million wireless subscribers. Verizon is the largest U.S. carrier with $88 billion in 2017 wireless revenue and 111 million subscribers, and AT&T would be No. 2 with $71 billion in wireless revenue and have 78 million regular subscribers.


  • Reply 16 of 32
    nerd-guynerd-guy Posts: 1unconfirmed, member
    far as I know, all newer phones are compatible with GSM & CDMA......I got a Note 8, and an iPad pro 12.9 512
  • Reply 17 of 32
    dougd said:
    I've been a satisfied TMO user for years. I get unlimited everything including tethering for a hundred bucks a month. I never get throttled either.

    As far as I am concerned this is great news, it just means better coverage in fringe areas
    John Legere said T-Mobile will still be magenta, and he will still be the ceo of the new T-Mobile. John continuing to be ceo takes a lot of the worry away. This is great new imo as well
    cornchipronnpaisleydiscoGeorgeBMacspinnyd
  • Reply 18 of 32
    The benefits to customers for both parties are going to be pretty damn good
    spinnyd
  • Reply 19 of 32
    tallest skiltallest skil Posts: 43,399member
    John Legere said T-Mobile will still be magenta, and he will still be the ceo of the new T-Mobile. John continuing to be ceo takes a lot of the worry away. This is great new imo as well
    Oh, they’re not changing names? Or combining ideas? I don’t know; a company using this color as its primary would be eye-catching.

    Derived from the following combination, naturally.  :p

  • Reply 20 of 32
    cornchipcornchip Posts: 1,172member
    Oh boy.

    well at least it looks like we got best case scenario with Ledgere remaining CEO. figure it’ll be like the original iPhone days where the unlimited data folks got grandfathered in until they figured out a way to jack their rates. They’ll probably make us pay more for 5G.. they’ll get us somehow eventually.
    paisleydiscoGeorgeBMac
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