Sprint had approached cable company Charter Communications Inc (CHTR.O) about a potential merger earlier this year, but quickly abandoned this effort.
Since that time, Sprint has been outperformed by T-Mobile under Chief Executive John Legere, who the sources said would lead the company.
The progress toward a deal also suggests that T-Mobile and Sprint believe that the U.S. antitrust enforcement environment has become more favorable since the companies abandoned their previous attempt to combine in 2014 amid regulatory concerns.
The sources asked not to be identified because the negotiations are confidential. Sprint and Deutsche Telekom declined to comment. T-Mobile and SoftBank did not immediately respond to requests for comment.
When he appeared alongside the president-elect, dressed in a vest, Son made headlines in early December and tie nearly identical to that of the tycoon turned commander in chief.
When terms are finalized though discussions may fall through, the sources said.
Published at Fri, 22 Sep 2017 21:13:05 +0000
(Reuters) – T-Mobile US Inc (TMUS.O) is close to agreeing tentative terms on a deal to merge with Sprint Corp (S.N), people familiar with the matter said on Friday, a major breakthrough in efforts to unite the third and fourth largest U.S. wireless carriers.
Earlier this month, Federal Communications Commission Chairman Ajit Pai gave a potential boost to a tie-up when he recommended that the FCC find to the first since 2009 that there is “effective competition in the market for mobile wireless services.”
Son’s pledge to Trump to invest $50 billion in the United States and create 50,000 jobs was light but talked to the president’s election promise to boost economic growth by making deals with companies, rather than through complicated trade deals.
SoftBank founder Masayoshi Son and Trump met last year and said that the firm should gain from the guaranteed deregulation of Trump.
The most recent development in the talks between T-Mobile and Sprint comes as the telecommunications industry seeks ways to handle investments.
A merger would create a business with over 130 million subscribers, just behind Verizon Communications Inc (VZ.N) and AT&T Inc (T.N). Revenues would top $70 billion and analysts say there would be scope to cut costs.
SoftBank’s Son left an earlier effort to acquire T-Mobile for Sprint. SoftBank would have been with Deutsche Telekom, in charge of the company.
Japan’s SoftBank Group Corp (9984.
He was one of the first in a series of Asian billionaires and leaders to pay a congratulatory visit to Trump, who won office in November on a platform that focused on national security and protecting U.S. jobs.
The transaction would significantly unite the U.S. telecommunications market and represent the first transformative U.S. merger with significant antitrust risk to be agreed since the inauguration of U.S. President Donald Trump in January.
Reporting by David Shepardson in Washington and Arno Schuetze in Frankfurt reporting by Pamela Barbaglia in London, Douglas Busvine in Frankfurt, Greg Roumeliotis in New York; Writing by Douglas Busvine; Editing by Bernadette Baum and Meredith Mazzilli
“They will argue that the history of T-Mobile and Sprint reveals they are vigorous competitors and that this will not cease to be the case after the deal,” said Entner.
The FCC is set to vote on Tuesday on the projected annual report on the state of the wireless competition market required by U.S. Congress.
Sprint and T-Mobile will tout investments in their network that would create jobs and 5G, though blending operations would result in layoffs, said Roger Entner.
T-Mobile shares were up 0.4 percent to $63.66, giving that company a market capitalization of about $53 billion.
Last month, Sprint CEO Marcelo Claure said an announcement on merger talks should come from the “near future.”
AT&T is in the process of getting its own transformative deal, its $85.4 billion acquisition of media conglomerate Time Warner Inc (TWX.N) approved by U.S. regulators.