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  • narocz21795 narocz21795 Oct 3, 2012 4:53 PM Flag

    Better look at your deal closer that is why it is dropping.......

    Cash equals about 4 a share 1.5b and 26% of DTEGY which is around 12.59-12.89. Leaving DTEGY a 74% stake....does that come out to about 9ish a share??

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    • The deal is a "reverse merger", as smaller Metro PCS (9.3m subscribers) is buying the bigger T Mobile USA (33.2m). The deal gives Deutsche Telekom 74% ownership in the new company.

      The US$15bn intercompany loan being assumed by the new entity will go onto to the balance sheet as senior unsecured notes, and will likely be refinanced in the capital markets.

      The average tenor of the rollover notes is 8.5 years and their projected weighted average yield will be 8%.

      The new company also gets an additional US$500m revolver from DT and will issue another US$1bn of debt in the capital markets, which will also benefit from the DT backstop.

      The merger also involves a 1-for-2 reverse stock split and a cash payment of US$1.5bn to shareholders

    • better work on your logic and your math.

      tmobile was sold to at&t for 40 billion last december 2011. the feds blocked the deal on anti trust grounds.

      pcs shareholders are receiving 1.5 billion in cash plus 25 percent of the merged business.

      if we assume tmobile is worth 33 percent less from what at&t paid, the deal is still worth close to 10 billion to pcs shareholders, which is more than a 100 percent premium to what shares closed at today.

      there will be a lot of pressure to maintain 4 national players, as opposed to 2 or 3, going forward. the issue of smartphone access and wireless services is too important to be monopolized by 2 or 3 players. the feds will make sure the new NewCo merger thrives....sprint will soon enough purchase leap, and the field will be set, with remaining battles over spectrum access and 4g buildout...


      Sentiment: Strong Buy

    • From DTEGY board.......Not so sure about that. From today's Globe and Mail -----------------------

      Deutsche Telekom did not discuss a potential deal structure in its statement.

      But two sources familiar with the matter said that under terms of the deal being discussed, Deutsche Telekom would contribute its T-Mobile USA operations rather than paying cash. In return it would get a stake in MetroPCS, with the option to sell that on the stock market later.

      The structure, known as a reverse initial public offering, involves a private company such as T-Mobile USA gaining a public listing by acquiring a public company, said the sources who asked not to be named as they are unauthorized to speak to the media.