Iliad and Sprint's Market Value Drops as T-Mobile US Rises

Yesterday was a bit of a crazy day. We actually had more articles about T-mobile yesterday than we've had since the Uncarrier event earlier this summer. T-Mobile started off the day announcing earnings, which were pretty decent, making over $300 million in profit and adding 1.5 million new connections. Then they did the earnings call with Q&A and of course, T-Mobile's CEO, John Legere was asked about the T-Mobile/Sprint merger. Which he couldn't say much about. But later on in the day, word came out that a French telecom, Iliad was putting down a bid on T-Mobile, for just $15 billion. Which would give them 56% stake in the company. A few hours later Deutsche Telekom came out and declined their offer. And now the market is changing based on that.

After Iliad's offer was decline, we saw T-Mobile's market value rise about 7%. Which probably is because so many people are looking to buy the company, so investors have more faith in them now. Although Sprint's did decline about 7% and Iliad's went down 13%. What's the most interesting here though, is that Iliad's market value is now less than their bid for T-Mobile US was. According to Bloomberg:

"...the savings Iliad is projecting from the combination may be hard to achieve because the two carriers aren't in the same country, said Nuno Matias, a Banco Espirito Santo SA analyst in Lisbon. An increase in Iliad's debt is also a concern, he said. After today's decline, Iliad's market value is smaller than its bid for the T-Mobile stake."

Deutsche Telekom declined the offer because they felt it wasn't competitive enough. Iliad was offering $33 per share, while Softbank/Sprint is said to be offering $40 per share in their deal - which they are still working on. So it's clear that Deutsche Telekom either thinks that the Sprint deal will be approved once it's official. Or they really aren't in a huge rush to get out of the US, like they were just a few years prior.

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Alexander Maxham

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Alex has written for Androidheadlines since 2012 as Editor of the site and traveled the World to many of the biggest Smartphone and Technology events. Alex has a background in Technology and IT and Deep Passion for Everything Android and Google. His specialties lay in Smartphones of all budgets, Accessories, Home Automation and more. Contact him at [email protected]
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