Sprint & T-Mobile Not in "Serious Discussions" About Merging

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A couple of years ago, before Marcelo Claure was installed as the CEO of Sprint, with Dan Hesse still running the show, SoftBank and Sprint were looking to acquire T-Mobile and merge the two companies. The thought process behind this was to merge the two smaller carriers and create a big carrier that can compete with AT&T and Verizon. At the time, T-Mobile was the fourth largest carrier, with Sprint being number three – that's now the other way around – and combining them would still put them far behind AT&T and Verizon as far as subscribers go. But with all of that spectrum, the two could create a network to compete with the "duopoly", as T-Mobile's CEO, John Legere refers to them.

While Sprint stopped pursuing T-Mobile in 2014, and then got a new CEO in Marcelo Claure, there hasn't been much said about Sprint wanting to acquire T-Mobile. That was until earlier this week. When SoftBank's CEO, Masayoshi Son, noted that he still hopes to merge Sprint with T-Mobile. Although he is waiting until the new FCC Commissioners are named, as the current regulators want four major US carriers.

In an interview with Fortune today, Sprint's CEO Marcelo Claure said that they are not "in any serious discussions" regarding a merger with T-Mobile. Claure did mention that while a merger is compelling, it's still very unlikely to happen right now. Stating that merging with T-Mobile today "is a wish".

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While Son and Claure are hoping that the new FCC head will allow them to merge with T-Mobile, it's still going to be a tough sell. AT&T attempted to buy T-Mobile a few years ago, and that was blocked by regulators. In that deal, AT&T ended up giving T-Mobile $3 billion in cash and around another billion in spectrum, as part of the breakup fee that the two had agreed on prior. Sprint's attempt at acquiring T-Mobile never got that far, as they were testing the waters to see whether it would be possible. Now with Deutsche Telekom not wanting to get out of the US as badly as they did a few years ago, it might be a tougher sell for someone to take T-Mobile USA off of their hands.