US telco Sprint has reportedly scrapped its bid to buy smaller rival T-Mobile, boosting French mobile challenger Iliad as it looks to satellite and cablecos to sweeten its own offer.
Number three US carrier Sprint dropped its US$40 per share deal for…
US telco Sprint has reportedly scrapped its bid to buy smaller rival T-Mobile, boosting French mobile challenger Iliad as it looks to satellite and cablecos to sweeten its own offer.
Number three US carrier Sprint dropped its US$40 per share deal for the country’s number four amid regulatory pressure to keep four players in the market, according to multiple reports.
Iliad does not face this issue, but its US$33 per share offer for 56.6% of T-Mobile is reportedly on the verge of being thrown out by the latter’s German parent Deutsche Telekom for being too low.
This has prompted the group to talk to companies such as DTH broadcaster Dish Network, which has considered buying T-Mobile in the past and, last year, tried to acquire Sprint to help it deploy a terrestrial network with its satellite spectrum.
During a results call on 6 August, Dish chairman Charlie Ergen said it could make sense to bid for T-Mobile now that Sprint is out of the running.
“Certainly to the extent that Sprint either dropped out or wasn’t interested or the government wouldn’t allow it … then T-mobile is something we would have an interest in,” he said.
Other potential bidding partners are reported to include Cox Communications, Charter Communications, Ontario Teachers’ Pension Fund and Singaporean sovereign wealth fund GIC.
Iliad created a shockwave in France’s mobile industry in 2012 when its Free Mobile unit started offering much cheaper services than its rivals. French telcos Orange, SFR and Bouygues Telecom have all seen their subscriber numbers decline as a result.
Sprint, which is owned by Japan’s Softbank, had been in talks about a deal for T-Mobile for months.
Ever since Softbank took control of Sprint in 2013, its owner Masayoshi Son had hoped to combine the two companies to better compete with larger rivals AT&T and Verizon.
However, US telecoms regulator FCC earlier this week proposed preventing the nation’s largest operators from making joint bids in next year’s spectrum auction – a further indication that a merger between the two companies would be blocked too.
Sprint and T-Mobile were also reportedly considering raising US$10bn and forming a joint venture to bid for 600 MHz spectrum, in case their merger was not complete by the time the auction took place.
Sprint, Softbank, T-Mobile US and Deutsche Telekom were not immediately available to comment. Iliad declined to comment.
