Mobile And Sprint Abandon Merger Talks

Delia Watkins
November 5, 2017

The two carriers have been huddled for weeks, but reports suggested talks hit several hurdles.

Wireless carriers Sprint and T-Mobile called off a potential merger, saying the companies couldn't come to an agreement that would benefit customers and shareholders.

Sprint Corp and T-Mobile US Inc said on Saturday they have called off merger talks to create a stronger USA wireless to rival to market leaders, leaving No. 4 provider Sprint to engineer a turnaround on its own. However, after T-Mobile CEO John Legere spoke with Sprint CEO Marcelo Claure on Wednesday, Sprint's board discussed the new offer at a meeting on Thursday. But T-Mobile lobbed in a last minute counter offer and there was hope again that a deal could be salvaged. "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 standalone performance and track record".

T-Mobile and Sprint are the third- and fourth-largest USA wireless carriers but they are significantly smaller than AT&T and Verizon, who effectively have a duopoly over United States wireless service.

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It comes as Sprint has somewhat struggled in an increasingly competitive United States mobile market.

Both companies had expressed interest in a tie-up this year, and industry analysts expected T-Mobile to have more leverage in discussions this time around.

Sprint has a lot of debt and has posted a string of annual losses. A merged T-Mobile-Sprint would have been a major challenger to number two AT&T, and could have given Verizon a run for the top spot in a few years.

SoftBank CEO Masayoshi Son said in May that the Obama administration was "quite tough on business", and added "the door is open" for potential mergers with the new administration.

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