T-Mobile and Sprint are presently in the process of finalizing their merger negotiations which are in highly advanced stages, Bloomberg reported on Friday, citing people familiar with the ongoing consolidation efforts. The deal itself is likely to be announced by late October when both wireless carriers detail their consolidated financial reports for the third quarter of the year. Neither mobile service provider yet decided on a date for publishing its Q3 2017 results but should share more details on the matter in the coming days. Last year, T-Mobile and Sprint published their Q3 2016 results on October 24th and 25th, respectively.
Sprint and T-Mobile have been negotiating about a potential merger ever since the quiet period imposed by the Federal Communications Commission came to an end this summer after the agency concluded its latest spectrum auction. While Sprint's parent SoftBank already expressed interest in merging the two back in 2014, the deal itself wasn't possible under the former Obama administration which was strongly opposed to the idea of any major consolidations in the wireless segment during its tenure. The Trump-led White House advocates a more relaxed approach to regulating the industry and could hence be more inclined to approve such a deal, though SoftBank is now unlikely to be the one who ends up controlling the hypothetical merged entity. T-Mobile managed to surpass Sprint in terms of subscribers and general performance in recent years and Deutsche Telekom has less incentive to merge its subsidiary than SoftBank does, especially given the significant differences in their market caps.
Due to that state of affairs, the two have reportedly agreed to an all-stock deal which will see them exchange portions of their investments. Such a transaction would put the German telecom giant in control of the merged company while still allowing SoftBank to maintain a significant stake in the U.S. wireless segment. The Japanese conglomerate was supposedly ready to accept a stock-for-stock exchange rate around Sprint's current market cap last month, sources said, suggesting that nothing has changed on that front in the meantime. Sprint is presently valued at around $30 billion and isn't interested in having a termination fee in its merger agreement, though SoftBank may still ask for one during the final rounds of their talks, insiders claim. Should the two officially announce their intentions to merge come next month, their proposal should start being reviewed by the Department of Justice and other competent agencies by the end of the year and may be approved or denied in early 2019.