Reuters: Softbank wants Sprint and T-Mobile to merge, would give up control to Deutsche Telekom
Softbank, the owner of Sprint, may soon approach T-Mobile US owner Deutsche Telekom for a merger proposal. One concession the Japanese conglomerate might cede is control of the combined company, sources to Reuters say. The meeting has not happened as FTC rules bar such communications between rivals as the 600MHz spectrum auction is set to go on through April.
Enter the presidency of Donald Trump, one seemingly concerned less with antitrust laws, and a new age of business in the telecom industry. AT&T and Verizon have been picking up media properties while T-Mobile CEO John Legere has suggested that he would be open to a power play of service companies. An overall stronger T-Mobile that has grown its user base by the millions over the past four years has emboldened Deutsche Telekom CEO Tim Hoetteges into keeping a unit that he was eager to shop just half a year earlier.
Softbank has an 83 percent stake in Sprint, a company worth $36 billion, while Deutsche Telekom owns 65 percent of T-Mobile US, which has grown its market value from $30 billion in 2013 to more than $50 billion.
While the Trump administration deplores regulation, it is not clear what kind of attitude it may take to a Sprint/T-Mobile redux as appointments across many positions at the Justice Department, Commerce Department and the Federal Trade Commission have not been made — these are necessary government agencies that would oversee the transaction.