MetroPCS Communications is working with the Department of Justice in an attempt to get final approval on a merger deal with Deutsche Telekom’s subsidiary T-Mobile. The DOJ requested additional information from the Dallas-based wireless provider, though MetroPCS did not specify which details were requested.
Overall, MetroPCS is still optimistic about its chances to complete the merger, thought the approval process could be postponed another 30 days. Still, the timetable would put the completed deal in the first half of 2013 (not a moment too soon for both MetroPCS and T-Mobile). Both companies involved feel that the U.S. government will approve the deal since the merger seems to be pro-competition and pro-consumer.
The merger between MetroPCS and T-Mobile has not been without its challenges. As recently as last month, MetroPCS shareholders were filing a lawsuit in an attempt to get more out of the deal with T-Mobile. Though the company was once valued at over $10 billion, shareholders “only” saw $1.5 billion out of the deal.
And, of course, it’s not just the cost of the purchase itself that adds so much to the price of acquisitions. A “non-cash” impairment charge of $8.1 billion hit the ol’ profit margin during the last quarter, causing T-Mobile’s third quarter earnings to show a whopping net loss of $7.8 billion.
Still, once the deal is done, the unified companies stand a much stronger chance at competing. The deal will not make T-Mobile a direct competitor of AT&T and Verizon, but it at least helps to keep T-Mobile viable. With unlimited 4G plans, T-Mobile has the opportunity to appeal to the hungriest of data users in the mobile market.
2013 stands to be an interesting year in the mobile market, with T-Mobile and Sprint both making significant deals to bolster their standings.
Source: Android Central