Telecoms firm Sprint is moving closer to an acquisition of T-Mobile US in a $32 billion deal that would merge America’s third and fourth biggest wireless companies and create a rival to US market leaders AT&T and Verizon Wireless.
If talks are successful, Sprint could offer up to $40 a share for T-Mobile US in a deal comprised of 50 per cent cash and 50 per cent stock, according to reports late on Wednesday. T-Mobile shares were trading up about 2 percent at $35 in after hours trading.
Deutsche Telekom, which owns about 67 per cent of T-Mobile, could retain a stake of between 15 and 20 per cent in the merged company.
Japan’s SoftBank, which owns about 80 per cent of Sprint, has long coveted a deal to buy T-Mobile, even though such a merger could face scrutiny by U.S. regulators.
In 2011, U.S. regulators rejected a $39 billion takeover bid for T-Mobile US from AT&T.
In March this year, SoftBank chief executive Masayoshi Son told US television talk show host Charlie Rose that if the deal went through, he would start a price war to challenge AT&T and Verizon Wireless.
“We would like to make the deal happen, but there are steps and details that we have to work out,” said Son in March.
For Deutsche Telekom, analysts said an exit from the United States would help it invest in its network in Germany and develop its operations across Eastern Europe.