A new report has just surfaced, claiming that T-Mobile and Sprint actually made some progress in merger talks, and the report actually claims that a deal could be struck as early as next week. This information comes from “people familiar with the matter”, and was published by Reuters. T-Mobile and Sprint are the third and fourth largest carriers in the US, and they have been negotiating a merger for quite some time now, though the last round of merger talks commenced earlier this month, on April 10.
Now, if T-Mobile and Sprint actually reach an agreement, and merge, they would have over 127 million customers, and would be a much more powerful competition for Verizon and AT&T, not to mention that their 5G prospects would rise as well. Deutsche Telekom, a majority owner of T-Mobile, and SoftBank, a company which controls Sprint, are actually trying to reach an agreement when it comes to voting control over a joint company, at least according to the info provided by sources. Sources also claim that Deutsche Telekom and T-Mobile are finalizing the debt financing package that they would use to fund the deal. None of the involved parties were willing to comment on said information, which is to be expected, especially if a deal is really looming.
That being said, it’s worth noting that the last round of talks between Deutsche Telekom and SoftBank broke down due to valuation disagreements, that was back in November last year. Spring has managed to grow under the Marcelo Claure, but that growth has been driven by discounting, and analysts say that Sprint needs T-Mobile in order to invest in its network, and to offer proper competition in an already-saturated market. T-Mobile’s growth has been vast under the lead of John Legere, but T-Mobile is still distant third carrier in the US, so this merger could benefit T-Mobile quite a bit as well. Now, these two companies could face regulatory hurdles on the way to a merger, but for that to happen, they actually need to agree on terms first, so it remains to be seen what will happen next week, if there’s any truth to today’s report.