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| Sprint and T-Mobile call off merger talks after failure to reach agreement | Sprint and T-Mobile call off merger talks after failure to reach agreement |
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| Wireless carriers Sprint and T-Mobile have called off a potential merger, saying they could not come to an agreement that would benefit customers and shareholders. | Wireless carriers Sprint and T-Mobile have called off a potential merger, saying they could not come to an agreement that would benefit customers and shareholders. |
| The two companies have been dancing around a possible merger for years, and were again in the news in recent weeks with talks of coming together after all. But in a joint statement on Saturday, Sprint and T-Mobile said they were calling off merger negotiations for the foreseeable future. | |
| “The prospect of combining with Sprint has been compelling for a variety of reasons, including the potential to create significant benefits for consumers and value for shareholders,” said John Legere, president and CEO of T-Mobile US, in a prepared statement. | “The prospect of combining with Sprint has been compelling for a variety of reasons, including the potential to create significant benefits for consumers and value for shareholders,” said John Legere, president and CEO of T-Mobile US, in a prepared statement. |
| “However, we have been clear all along that a deal with anyone will have to result in superior long-term value for T-Mobile’s shareholders compared to our outstanding stand-alone performance and track record.” | “However, we have been clear all along that a deal with anyone will have to result in superior long-term value for T-Mobile’s shareholders compared to our outstanding stand-alone performance and track record.” |
| T-Mobile and Sprint are the third- and fourth-largest US wireless carriers but they are significantly smaller than AT&T and Verizon, who effectively have a duopoly over US wireless service. The two companies have said they hoped to find a way of merging to make the wireless market more competitive. | T-Mobile and Sprint are the third- and fourth-largest US wireless carriers but they are significantly smaller than AT&T and Verizon, who effectively have a duopoly over US wireless service. The two companies have said they hoped to find a way of merging to make the wireless market more competitive. |
| Sprint and its owner, the Japanese conglomerate SoftBank, have long been looking for a deal as the company has struggled to compete on its own. But Washington regulators have frowned on a possible merger. | Sprint and its owner, the Japanese conglomerate SoftBank, have long been looking for a deal as the company has struggled to compete on its own. But Washington regulators have frowned on a possible merger. |
| AT&T’s offer to buy T-Mobile in 2011 was spiked and the same regulators signaled in 2014 they would have been against Sprint doing the same thing. With the new Trump administration, it was thought regulators might be more relaxed. | AT&T’s offer to buy T-Mobile in 2011 was spiked and the same regulators signaled in 2014 they would have been against Sprint doing the same thing. With the new Trump administration, it was thought regulators might be more relaxed. |
| Sprint has a lot of debt and has posted a string of annual losses. The company has cut costs and made itself more attractive to customers, BTIG Research analyst Walter Piecyk said, but it has not invested enough in its network and does not have enough airwave rights for quality service in rural areas. | Sprint has a lot of debt and has posted a string of annual losses. The company has cut costs and made itself more attractive to customers, BTIG Research analyst Walter Piecyk said, but it has not invested enough in its network and does not have enough airwave rights for quality service in rural areas. |
| T-Mobile has been on a years-long streak adding customers. After the government nixed AT&T’s attempt to buy it in 2011, T-Mobile led the way in many consumer-friendly changes, such as ditching two-year contracts and bringing back unlimited data plans. Consumers are paying less for cellphone service thanks to T-Mobile’s influence on the industry and the resultant price wars. | T-Mobile has been on a years-long streak adding customers. After the government nixed AT&T’s attempt to buy it in 2011, T-Mobile led the way in many consumer-friendly changes, such as ditching two-year contracts and bringing back unlimited data plans. Consumers are paying less for cellphone service thanks to T-Mobile’s influence on the industry and the resultant price wars. |
| “T-Mobile does not need a merger with Sprint to succeed, but Sprint might need one to survive,” Piecyk wrote in an October research note. | “T-Mobile does not need a merger with Sprint to succeed, but Sprint might need one to survive,” Piecyk wrote in an October research note. |