Initial agreement for T-Mobile and Sprint merger may happen soon

Michael Potuck | Sep 22 2017 - 7:52 am PT

A woman talks on her phone as she walks past T-mobile and Sprint wireless stores in New York in this file photo from July 30, 2009. Sprint Corp is mulling a bid for T-Mobile US, according to a report in the Wall Street Journal citing people familiar with the matter. REUTERS/Brendan McDermid/Files (UNITED STATES - Tags: BUSINESS TELECOMS)

A report this morning from Reuters shares that T-Mobile is “close to agreeing tentative terms” for a merger deal with Sprint after months of talks. News of a T-Mobile and Sprint merger have been floating around since May.

The details of this year’s merger would give T-Mobile’s parent company, Deutsche Telekom a majority stake (T-Mobile is now the #3 carrier, followed by Sprint). Back in 2014, Sprint was looking at acquiring T-Mobile, but abandoned those plans.

Reuters sources say that after an initial agreement and due diligence from each company, we could see a formalized deal by the end of October, although the merger could still be nixed.

The report notes that if the merger would happen, it would create about 130 million wireless customers, putting a combined T-Mobile/Sprint just behind Verizon and AT&T who have roughly 146 million and 134 million customers respectively.

No doubt that this merger would have to deal with a tough road of anti-trust concerns, which is what deterred Sprint a few years back.

SoftBank founder Masayoshi Son abandoned an earlier attempt to acquire T-Mobile for Sprint in 2014 amid opposition from anti-trust regulators concerned that consumers could lose out.

But then again, maybe a more robust “Un-Carrier” could give customers better coverage, more choice, and force Verizon and AT&T to be more competitive.