Report: Japan’s SoftBank in Talks to Acquire T-Mobile

Japan’s SoftBank Corp, owner of Sprint, is in talks to acquire U.S.-based wireless carrier T-Mobile, according to media reports. The deal is designed to have Sprint take the majority stake in T-Mobile, a Reuters’ source said.

T-Mobile is the No. 4 wireless carrier in the country, but the deal would let SoftBank “leapfrog” Verizon and AT&T into the No. 2 slot. The Reuters report cites unnamed sources — a common practice in merger and acquisition news. More from Reuters:

Sprint has been interested in combining with T-Mobile for years and top executives from both companies have said that consolidation was necessary in the U.S. wireless market, as cooperation in infrastructure and equipment orders would create a stronger rival against the two biggest players.

Both the U.S. Federal Communications Commission, which turned down AT&T’s application to acquire T-Mobile in 2011 due to competition concerns, and the Justice Department chiefs have signalled they will take a hard line in scrutinising consolidation bids.

AT&T tried to purchase the Deutsche Telekom-owned T-Mobile about two years ago before the U.S. Justice Department sued to stop the merger, citing the possibility of higher prices and poorer service for consumers. AT&T later withdrew its bid.

T-Mobile stock rose the day after news broke Christmas Day of the possible acquisition.

Publish date: December 26, 2013 © 2020 Adweek, LLC. - All Rights Reserved and NOT FOR REPRINT