Ignores fact that one is GSM based and the other cdmaOne based
Mobile industry analaysts are always fond of saying that the USA has fared better in the 4G stakes because of consolidation amongst the US MNOs [Mobile Network Operators]. Now there’s a chance of deepening that consolidation with the prospect of the country’s third- and fourth-biggest mobile operators merging. USA-based operator, Sprint (formerly Sprint Nextel) has lined up eight banks to finance its proposed purchase of T-Mobile USA. According to a report on Reuters, the debt package exceeds $40 billion (£25.3 billion) and includes a bridge loan of roughly $20 billion from Japan’s Softbank as well as a $20 billion refinancing of T-Mobile’s existing debt.
Sprint is itself majority-owned by Softbank – an MNO in its own right rather than being a bank as the name implies.
Germany’s entrenched telecoms operator, Deutsche Telekom, owns T-Mobile USA and recently became a 50:50 partner with Orange in the UK’s MNO, EE. So it is no stranger to consolidation deals.
The pair have agreed to broad terms of a deal, under which Sprint would pay around $40 per share for T-Mobile USA, valuing the USA’s fourth largest MNO at nearly $32 billion.
Five global banks have reportedly agreed to finance Sprint’s proposal to acquire T-Mobile USA, whilst three Japanese banks are also said to have been approached.
The markets, of course, choose to ignore the fact that the operators use rival cellular technologies. Sprint is cdmaOne based whilst T-Mobile is cdmaOne.
No worries because Sprint swallowed Nextel which used a third technology entirely supplied by Motorola – i-den.