The long-gestating merger between Sprint and T-Mobile, which was first rumored back in 2015, is reportedly set to be finalized really soon.
Both sides are conducting final due diligence to decide on the exchange ratio that will determine Sprint’s valuation, said the people, who asked not to be identified because the discussions are private. Sprint is the fourth biggest mobile network operator in the U.S. while T-Mobile is the third biggest wireless carrier in the US. The deal is expected to be an all-stock one, and the last major step that needs to be made is for a final valuation to be placed on Sprint.
Sprint shares closed Thursday at $7.50 in NY, valuing the company at about $30 billion.
Details surrounding the non-cash items are also being ironed out, including the location of the combined company’s headquarters and appointments to the executive management team. Comcast walked away from that deal a year later after regulators questioned its fairness.
In 2011, AT&T was forced to pay a $4 billion breakup fee to T-Mobile when its takeover attempt of the smaller wireless network failed. Although a breakup fee is apparently off the table now, there is still the possibility that SoftBank may still try to get a cash termination payment provision included depending on how negotiations on other issues goes.
The news of T-Mobile & Sprint merging is not new.
According to Bloomberg News, two of the biggest telecommunication companies in the United States could become one before the end of October with the deal to be announced when the carriers report on their quarterly earnings.
Though there were no official comments from Sprint, T-Mobile, SoftBank or Deutsche Telekom, the sources claim that if the last remaining obstacles can’t be resolved by the end of the month, an agreement could be pushed to a later date.