Mobile and Sprint finally discontinue merger talks
- Author: Terrell Bush Nov 06, 2017,
Nov 06, 2017, 0:18
FRANKFURT, Nov 5 (Reuters) - The collapse of the attempt by T-Mobile US to merge with Sprint Corp will underline its importance as a driver of growth when its main owner, Deutsche Telekom, reports quarterly results this week.
Charter's biggest shareholder is Liberty Global supremo John Malone, who has previously been linked with a potential bid for T-Mobile.
The failed merger could also keep wireless prices low as all four providers have been heavily discounting their cellphone plans in a battle for consumers.
Both companies jointly said they couldn't strike mutually agreeable terms.
"While we couldn't reach an agreement to combine our companies, we certainly recognize the benefits of scale through a potential combination". Nonetheless, Claure said that "we have agreed that it is best to move forward on our own". SoftBank CEO Masayoshi Son has talked about spinning off a new company that would own the valuable spectrum as a way to unlock its value.
Sprint is in the middle of a turnaround plan and has sought to strengthen its balance sheet by cutting costs. Now that nothing has changed, Sprint remains in a vulnerable position, having reported annual losses for ten consecutive years.
T-Mobile, on the other hand, is still the fastest growing and most innovative carrier in the states.
But no deal was announced immediately following the conclusion of a ban on merger talks in the spring that was associated with a US government auction of wireless airwaves.
Reports suggest that a major hurdle to the merger wasn't Sprint or T-Mobile directly, but rather the their ownership.
An added wrinkle was Sprint's negotiations with cable companies Comcast Corp and Charter Communications Inc.
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.
Sprint and its owner, the Japanese conglomerate SoftBank, have always been looking for a deal as the company has struggled to compete on its own. Initially, the merger seemed to be a done deal.