Sprint, T-Mobile to Merge

SoftBank Group unit Sprint announced a long-sought merger deal with rival T-Mobile US, reaching a breakthrough after SoftBank Chairman and CEO Masayoshi Son agreed to give up control of the carrier to gain the scale needed to compete effectively in the battle over 5G, Nikkei reported. The all-stock transaction will combine America’s third- and fourth-largest wireless carriers into a new company to be established by SoftBank and T-Mobile parent Deutsche Telekom. Deutsche Telekom will have a 41.7% stake in the new T-Mobile, while SoftBank will hold 27.4%, the two carriers said. SoftBank began pursuing T-Mobile soon after acquiring Sprint in 2013. The last round of merger talks fell through in November 2017 as the two sides failed to reach an accord on ownership of the merged carrier. Because Sprint’s market capitalization was smaller than T-Mobile’s, there was a possibility that SoftBank would have to cede control as the minority partner, which Son then concluded would be unacceptable to the Japanese technology company’s board. The two sides returned to the negotiating table a month or two ago.