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posted by martyb on Monday April 30 2018, @02:49PM   Printer-friendly
from the third-time's-the-charm? dept.

T-Mobile, Sprint to merge in all-stock deal

"T-Mobile US Inc. and Sprint Corp. agreed on Sunday to merge in an all-stock transaction, following on-again, off-again talks to combine the two companies." foxbusiness.com/markets/t-mobile-sprint-to-merge-in-all-stock-deal

T-Mobile and Sprint to Attempt Merger

T-Mobile and Sprint have reached an agreement to merge. The combined company would be called T-Mobile. Now they face the regulators, and are already arguing for it as a move for America to remain competitive with China on 5G:

T-Mobile and Sprint reached a $26.5 billion merger agreement Sunday that would reduce the U.S. wireless industry to three major players — that is, if the Trump administration's antitrust regulators let the deal go through. The nation's third- and fourth-largest wireless companies have been considering a combination for years, one that would bulk them up to a similar size as industry giants Verizon and AT&T. But a 2014 attempt fell apart amid resistance from the Obama administration.

Consumers worry a less crowded telecom field could result in higher prices, while workers unions are concerned about potential job losses.

In a conference call with Wall Street analysts, Sprint CEO Marcelo Claure acknowledged that getting regulatory approval is "the elephant in the room," and one of the first things the companies did after sending out the deal's news release was to call Ajit Pai, chairman of the Federal Communications Commission. The companies stressed that they plan to have more employees following the combination, particularly in rural areas, than they do as stand-alone companies now. They also emphasized that the deal would help accelerate their development of faster 5G wireless networks and ensure that the U.S. doesn't cede leadership on the technology to China.

And they said the combination would allow them to better compete not only with AT&T and Verizon but also with Comcast and others as the wireless, broadband and video industries converge. "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," T-Mobile chief executive John Legere said in a statement.

T-Mobile press release. Also at Bloomberg.


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  • (Score: 3, Insightful) by Virindi on Monday April 30 2018, @03:29PM (2 children)

    by Virindi (3484) on Monday April 30 2018, @03:29PM (#673769)

    One has to wonder, since "merge with a competitor to reduce competition" seems to now be #1 in the MBA playbook, what will happen when they run out of competitors. It seems to be fast approaching that point in many industries. They will be able to crank up prices and cheap out service for awhile, but after a few years such strategies will see diminishing returns......and the MBAs and Wall Street will need to find some other way to artificially boost numbers.

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  • (Score: 3, Informative) by Arik on Monday April 30 2018, @03:55PM

    by Arik (4543) on Monday April 30 2018, @03:55PM (#673779) Journal
    Oh that's the key maneuver, the exit.

    1. Acquire/merge.
    2. Eliminate every cost you can get away with eliminating in the short term. This means real redundancies as well as core competencies are lost (and even if you care you may have difficulty distinguishing the two,) but in the  short term you can certainly show an astonishing turnaround and incredible profits.
    3. Exit. Collect your bonuses, DO pass GO, DO move on to another venture, or retire if you prefer, but get the heck out of dodge and liquify all your holding BEFORE
    4. The collapse. This can be a dramatic event (as with Enron) or a slow and drawn out affair (as with our ISPs here in the US) but it's the inevitable result of step 2.
    --
    If laughter is the best medicine, who are the best doctors?
  • (Score: 0) by Anonymous Coward on Monday April 30 2018, @07:49PM

    by Anonymous Coward on Monday April 30 2018, @07:49PM (#673886)

    what will happen when they run out of competitors

    Combined, Sprint and T-mobile will be smaller than both AT&T and Verizon. Read that again, combined the new company will still be in third place by subscribers and by revenue. It will be a long time before they run out of competitors.

    IMO, what this merger will accomplish is put more pressure on AT&T and Verizon to compete harder. A strong third will push them harder than 2 weak 3rd/4th companies.