Sprint Merger with T-Mobile Inches Closer in the USA
Published on: 30th May 2014
A merger between the USA based mobile networks, Sprint and T Mobile USA has reportedly moved much closer following a deal between the two company's major shareholders.
Germany's Deutsche Telekom is reported to have agreed to sell its 67% stake in T-Mobile USA to Softbank, which owns a majority stake in Sprint.
A buyout proposal was made by Softbank chairman Masayoshi Son in a meeting with Deutsche Telekom a couple of weeks ago, Reuters reported on Thursday, citing Japan's Kyodo.
Deutsche Telekom was said to have been positive about such a transaction.
Speculation that a deal was imminent has been mounting all year, and was fueled by Deutsche Telekom's decision to shift the holding company that owns its T-Mobile stake from Germany to the Netherlands. Such a move would reduce the tax bill if a sale takes place.
SoftBank's CEO Masayoshi Son was also recently reported to have held talks with at least five banks to finance a possible bid.
He is said to be looking to raise around USD20 billion for the takeover bid.
However, such a deal would face an enormous regulatory barrier, and is likely to be difficult to consummate without considerable concessions to the US regulators.