|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's Range||16.98 - 17.16|
|52 Week Range||16.00 - 24.00|
|Beta (5Y Monthly)||0.31|
|PE Ratio (TTM)||17.61|
|Forward Dividend & Yield||0.78 (4.64%)|
|Ex-Dividend Date||Mar 28, 2019|
|1y Target Est||20.03|
(Bloomberg) -- With the U.S. campaign against Huawei Technologies Co. threatening to disrupt the rollout of 5G wireless networks, phone carriers are joining forces to develop technology that can reduce their reliance on a handful of powerful equipment suppliers.The Chinese company dominates the European market for telecommunications gear, ahead of Ericsson AB of Sweden and Finland’s Nokia Oyj. Governments are weighing whether to follow the U.K. and limit Huawei’s share of 5G networks over concerns -- denied by the company -- that it represents a security risk.If they do, it could knock the progress of 5G off course: The big three have designed a lot of their wireless gear so it can’t easily be integrated in the same network, much like an electric toothbrush only works with its own brush heads. So building 5G with Nokia or Ericsson kit on top of Huawei 4G infrastructure is fraught with complexity and costs.Companies including Deutsche Telekom AG and Vodafone Group Plc have decided to combine separate projects to develop a more standardized, flexible network architecture that would make it easier for carriers to use products from multiple vendors, according to people familiar with the matter.Under the plans, the O-RAN industry alliance, backed by Deutsche Telekom and AT&T Inc. among others, will align its work with the Telecom Infra Project, which was started by Facebook Inc. and is supported by several phone companies, said the people, who asked not to be named as the plans aren’t yet public.The industry is pursuing the efforts with greater urgency partly because they’re alarmed by the prospect of restrictions on Huawei in more markets such as Germany, one of the people said. The U.K.’s decision to limit Huawei’s share of broadband infrastructure already led BT Group Plc to predict a 500 million-pound ($650 million) hit to its finances.The carriers were planning to announce the O-RAN/TIP initiative at the wireless industry’s biggest annual showcase in Barcelona next week, before it was canceled due to the coronavirus outbreak, the people said. An announcement could instead come as early as this week.O-RAN’s goal from the start has been to “invite in more players with new ideas to help make the network stronger and more secure,” said Deutsche Telekom spokeswoman Pia Habel. She declined further comment.A spokeswoman for TIP declined to comment. A representative for O-RAN could not immediately be reached for comment.Negotiating PowerEnsuring that antennas, switches and other gear from competing suppliers can communicate seamlessly may also make it harder for any vendor -- Ericsson and Nokia included -- to clinch contracts just because the customer already uses its equipment. That could strengthen the negotiating position of carriers in contracts for 5G networks that are set to cost the industry hundreds of billions of dollars.AT&T has said it wants to replace the proprietary software that Nokia, Ericsson and Huawei use to run their wireless network gear with an open software.Vodafone has begun issuing small contracts for OpenRAN, an initiative backed by TIP to standardize radio access network hardware and software. CEO Nick Read said in October that Vodafone was “ready to fast track it into Europe as we seek to actively expand our vendor ecosystem.”O-RAN began in 2018 as a lobbying and research effort to make the radio access network -- the largest part of a wireless system -- more transparent and inter-operable. TIP is a broader project involving hundreds of companies working across all elements of networks.O-RAN and TIP may already be changing the economics of the industry and giving newer players more room. It’s now possible to design a “virtual” wireless network, which uses standardized, open-source software in conjunction with hardware from different vendors.Rakuten Inc. is using such technology to roll out a virtual network in Japan. U.S. satellite broadcaster Dish Network Corp., a member of the O-RAN alliance, aims to build a 5G network along similar lines.Ericsson and Nokia, reluctant to pick a fight with their biggest customers, have publicly welcomed O-RAN and TIP. Ericsson has joined O-RAN, while Nokia supports TIP and has been helping Rakuten build the Japanese network.Nokia Chief Executive Officer Rajeev Suri said in April last year it’s “better to be involved than not,” although he didn’t expect the model to be replicated in other parts of the world.\--With assistance from Thomas Seal, Angelina Rascouet, Niclas Rolander and Scott Moritz.To contact the reporters on this story: Stefan Nicola in Berlin at firstname.lastname@example.org;Rodrigo Orihuela in Madrid at email@example.com;Natalia Drozdiak in Brussels at firstname.lastname@example.orgTo contact the editors responsible for this story: Thomas Pfeiffer at email@example.com, Jennifer RyanFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Sprint closed today at a discount of $1.09, or 11%, to the value of T-Mobile’s original offer. This suggests a 5% to 7% cut in the Sprint deal price may be coming. Will SoftBank play along?
Moody's Investors Service ("Moody's") places three classes of notes sponsored by Sprint Corporation (Sprint, B2 review for upgrade) on review for upgrade. The Series 2016-1 Class A-1 notes and 2018-1 Class A-1 and Class A-2 notes were issued under the same master trust and are backed by a single 30-year lease to Sprint Communications, Inc. (SCI, B1/B3 review for upgrade) for a portfolio of wireless spectrum licenses and are further enhanced by a senior guarantee from Sprint and certain of its operating subsidiaries.
For an event meant to showcase the power of telecoms, cancelling this year's Mobile World Congress in Barcelona without a back-up plan has perplexed many in the trillion-dollar sector. Wednesday's decision to call off the telecoms industry's biggest annual gathering over fears of coronavirus, which has yet to reach mainland Spain, has left a hole in marketing budgets and dealt a $500 million blow to the local economy. Sony and Nokia said after pulling out of the event that they would hold product launches online instead, while South Korea's Samsung Electronics showcased a new folding phone at separate event in San Francisco last week.
(Bloomberg Opinion) -- Is Sprint Corp. a duck or a rabbit?Bear with us. Earlier this week, SoftBank Group Corp. founder Masayoshi Son showed investors a bemusing slide with an ambiguous image of a duck and rabbit. If you look at the picture from the right, you see a different critter than the view from the left.In his characteristically gnomic fashion, he was trying to suggest that there were two ways of evaluating SoftBank, and investors were doing so from the wrong perspective. But the analogy could also hold true for Sprint, the U.S. carrier in which SoftBank is the biggest shareholder, and whose planned merger with rival T-Mobile US Inc. finally secured the regulatory green light on Tuesday.When it was agreed back in April 2018, the all-stock deal gave Sprint an equity value of $27 billion. Since then, the two firms’ trajectories have diverged. Prior to Tuesday’s decision, T-Mobile stock had gained 31%, while Sprint had fallen 26%. Because Sprint shareholders are set to get T-Mobile shares in exchange for their existing stock, the value of the deal had therefore climbed to $36 billion, while the market only valued Sprint at $20 billion.So you can see why Deutsche Telekom AG, which owns 63% of T-Mobile, is now seeking to renegotiate the terms of the deal, whose existing terms lapsed in November. It looks like it might now be overpaying, so Tim Hoettges, the German firm’s CEO, has a fiduciary duty to his shareholders to at least give it a try.Here’s the metaphorical duck. Son is more vulnerable than he might have been just a week ago. That’s because the activist investor Elliott Management Corp. has built a stake in SoftBank, seeking governance improvements and a $20 billion buyback. SoftBank is meanwhile trying to find the capital for its new, reduced Vision Fund, the follow-up to the $100 billion pot of venture capital cash that Son used to make outsize bets on Uber Technologies Inc., WeWork parent We Co. and some 80 other firms over the past three years. The deconsolidation of Sprint reduces its debt exposure, while selling the remaining stake could free up capital to invest in the new fund or buybacks. The current deal terms value its stake at about $30 billion.What’s more, Sprint needs the merger more than T-Mobile. The declining share price has been driven by lackluster earnings and falling subscriber numbers. In the almost two years since the deal was agreed, Sprint’s number of subscribers has fallen by 460,000 to 54 million at the end of December. T-Mobile has meanwhile added 12 million customers for a total of 86 million.Now for the rabbit. A major renegotiation only becomes realistic if Deutsche Telekom and T-Mobile are prepared to walk away from the deal. T-Mobile stock’s 13% jump after the takeover was approved on Tuesday suggests that shareholders are happy with the deal even under the current terms. It will create value by reducing the cost of new 5G networks; giving the new company more pricing power over its customers; and letting the German-controlled firm get hold of Sprint’s valuable wireless frequencies.Ultimately, the deal remains in both firms’ interests. Deutsche Telekom would probably prefer an expensive takeover to no deal at all. Were the terms to be reevaluated based on the diverging stock prices, then T-Mobile could expect a swap ratio of at least 12 Sprint shares for each of its own (assuming a $27 billion valuation), up from the 9.75 shares agreed two years ago. Is such a drastic change likely? No. But given SoftBank’s need for cash, there’s a good chance it will be open to concessions to get the deal done.To contact the authors of this story: Alex Webb at firstname.lastname@example.orgTim Culpan at email@example.comTo contact the editor responsible for this story: Melissa Pozsgay at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Alex Webb is a Bloomberg Opinion columnist covering Europe's technology, media and communications industries. He previously covered Apple and other technology companies for Bloomberg News in San Francisco.Tim Culpan is a Bloomberg Opinion columnist covering technology. He previously covered technology for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Moody's Investors Service, ("Moody's") has today affirmed the Baa1 senior unsecured rating and (P)Baa1 MTN program ratings of Deutsche Telekom AG (DT) and Deutsche Telekom International Finance B.V. Concurrently, Moody's has affirmed DT's Prime-2 (P-2) commercial paper rating. A full list of affected ratings can be found at the end of this Press Release.
(Bloomberg) -- Deutsche Telekom AG wants to renegotiate the terms for the sale of Sprint Corp. to its U.S. wireless unit T-Mobile US Inc., according to people familiar with the matter.The German carrier, the majority owner of T-Mobile, is seeking a lower price because Sprint’s shares have been trading below their level when the deal was proposed in 2018, said the people, who asked not to be identified as the deliberations are private.Getting one of the biggest U.S. wireless mergers ever over the finish line would be a boon to both companies. For Deutsche Telekom, the deal reduces its reliance on Europe, where carriers are struggling to grow amid fierce competition. For the chairman of Sprint owner SoftBank Group Corp., Masayoshi Son, it allows him to better focus on his technology investments and the $100 billion Vision Fund. The renegotiation talks are expected to start soon, the people said. They would follow a victory for the companies in a U.S. court this week, when a federal judge rejected a state lawsuit against the tie-up. Now the deal is in the home stretch, with only minor approvals left to secure and final financial terms to be ironed out. SoftBank declined to comment. Deutsche Telekom didn’t immediately return a call seeking comment.Deutsche Telekom shares fell 1.4% in Frankfurt as of 12:58 p.m. on Thursday. What Bloomberg Intelligence Says:Deutsche Telekom has limited leverage to renegotiate the terms of its Sprint acquisition, we think, even as the valuation of the latter jumped to $75 billion from $60 billion in 2018 under the deal terms, despite worsening operational performance. The allure of consolidation, including the acquisition of an attractive spectrum portfolio, suggests only a modest potential improvement in stock-exchange ratio.\-- Erhan Gurses, BI telecoms analystClick here for the researchFrequency ConstraintsWhile Sprint’s standalone value has dropped, SoftBank also sees itself in a good position because T-Mobile needs Sprint’s wireless frequencies or would face capacity constraints within as little as two years, one of the people said.T-Mobile’s importance for Deutsche Telekom has grown steadily in recent years and it now accounts for about half of group sales, up from around a third in 2014. T-Mobile and Sprint haven’t renewed the merger agreement since it lapsed on Nov. 1, and there have been discussions regarding several issues that T-Mobile Chief Executive Officer John Legere described as “not hostile” that month on an investor call. T-Mobile has suggested there could be new terms.The combined company, which will operate under the T-Mobile name, will have a regular monthly subscriber base of about 80 million -- in the same league as AT&T Inc., which has 75 million subscribers, and Verizon Communications Inc., which has 114 million. T-Mobile will have more wireless frequencies than any other U.S. carrier, giving it an advantage as the industry transitions to the next generation of wireless technology, the much-faster 5G standard.Bloomberg News reported Wednesday that Sprint and SoftBank would likely have to accept a lower price than when the merger agreement was first forged in April 2018. Sprint’s monthly churn -- a closely watched measure of how many customers leave -- has risen to nearly 2%, which means roughly a quarter of its subscriber base is quitting the carrier each year.The German company is likely to leverage that to negotiate a lower price, but Sprint also has valuable radio frequency spectrum without which T-Mobile US will face serious bottlenecks, a person familiar with the matter told Bloomberg on Wednesday.The Financial Times previously reported that Deutsche Telekom is pushing to renegotiate terms of the deal, citing unidentified people familiar with the matter.(Updates with analyst comment in fifth paragraph)\--With assistance from Stefan Nicola.To contact the reporters on this story: Pavel Alpeyev in Tokyo at email@example.com;Scott Moritz in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Rebecca Penty at email@example.com, Thomas Pfeiffer, Jennifer RyanFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The decision to cancel a major telecoms conference in Barcelona slated for later this month after mass withdrawals due to fears over a coronavirus outbreak was motivated only by a desire to protect people's health and safety, organisers said on Thursday. "This is not about money - it's about health and safety and the reputation of our show," Mats Granryd, director general of the GSMA telecoms association that hosts the event told a news conference the day after announcing its cancellation.
The German telecoms company, which owns more than 60 per cent of T-Mobile US, wants to cut the price agreed for Sprint two years ago because the shares and performance of the company have deteriorated, said two people close to DT. The move is opposed by Sprint’s controlling shareholder, SoftBank of Japan, according to people close to the its chairman Masayoshi Son.
(Bloomberg) -- The wireless industry scrapped its biggest annual showcase after the coronavirus outbreak sparked an exodus of participants, roiling telecom companies just as they’re preparing to roll out new 5G services.It’s the first time in MWC Barcelona’s 33-year history that organizers have called off the event, which draws more than 100,000 participants from across the world to check out the latest innovations, pitch to investors and do deals.“The global concern regarding the coronavirus outbreak, travel concern and other circumstances, make it impossible” to hold the event, John Hoffman, chief executive officer of conference organizer GSMA, said in a statement to Bloomberg News.The list of big-name attendees started to crumble on Feb. 7, when Swedish wireless equipment maker Ericsson AB pulled out, saying it couldn’t ensure the safety of staff and customers. As others pulled the plug -- from Sony Corp. to Nokia Oyj, Vodafone Group Plc and Deutsche Telekom AG -- it became harder for those remaining to justify their presence.Bloomberg News reported earlier that GSMA could announce the cancellation as soon as Wednesday, after a meeting of members. As of Tuesday, the death toll in China from the virus rose to 1,113, and confirmed cases on the mainland have reached 44,653.MWC was due to run from Feb. 24 to Feb. 27. GSMA had stepped up sanitary precautions to reassure visitors -- advising against handshakes, introducing body temperature scanners and a protocol for changing microphones, and restricting entry to recent arrivals from China. Some delegations had replaced Chinese staff with colleagues from other countries or sent their China representatives ahead of time to avoid being barred.Who’ll Pay?Every year, telecom heavyweights use MWC and the oceans of publicity that come with it to generate marketing buzz around their latest wares. A big focus this year was going to be fifth-generation mobile services, and now several companies will need to reschedule launch events. Chipmaking giant Intel had planned to announce products for 5G networks and will hold an unveiling another time, according to a person familiar with its plans. Motorola was gearing up to showcase new 5G phones.The smartphone industry is trying to fire up stalled growth with the promise of higher data speeds and faster responsiveness. Smartphone shipments have been declining since 2016.The decision to scrap MWC entirely was a difficult one, and it’s not clear who will shoulder the costs -- the participants or GSMA. The industry’s biggest players often spend tens of millions of dollars to exhibit at the show. Ericsson’s absence alone left a gap bigger than a standard American football field in the conference halls.GSMA funds much of its budget from the event, charging 799 euros ($872) for a basic admissions pass.BarcelonaMWC is also important to the city of Barcelona, Spain’s second-largest city, as well as to many of the smaller companies that wouldn’t otherwise have access to such a large audience of mobile carriers and consumers. Large national contingents from Turkey to South Korea take to the show to encourage deal-making and inward investment.The regional government of Catalonia had been in touch with the conference organizers and said it saw no need to cancel events like MWC, Alba Verges, head of the Catalan government health department, said at a press conference in Barcelona.South Korea’s LG Electronics Inc. was among the first to rethink its participation, pointing out last week that most health experts had advised against “needlessly” exposing hundreds of employees to international travel.The global spread of the coronavirus has decimated other conferences, like Singapore’s annual airshow, which lost scores of corporate attendees but went ahead as planned on a smaller scale. Formula One confirmed it is postponing this year’s Chinese Grand Prix racing event due to the coronavirus outbreak, the Liberty Media Corp.-owned firm said in a Twitter post on Wednesday.(Updates with information on abandoned product launches by Intel and Motorola in seventh paragraph.)\--With assistance from Thomas Seal, Niveditha Ravi, Saritha Rai, Debby Wu, Ian King, Gao Yuan, Mark Gurman, Scott Moritz, Rodrigo Orihuela, Angelina Rascouet and Loni Prinsloo.To contact the reporter on this story: Nate Lanxon in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Tom Giles at email@example.com, Rob GolumFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- After some of the biggest telecom companies withdrew from the wireless industry’s top annual event because of concerns about the spread of the coronavirus, MWC Barcelona 2020 is all but dead.Members of the organizer, the GSMA, headed into a meeting on Wednesday expecting to announce a decision to cancel the conference in the afternoon, according to people familiar with the matter. However, the group based in London has been unable to arrive quickly at a conclusion on what to do.While many members of the lobby group publicly said they would withdraw, the organization’s base is broad and global. It’s not clear who would carry the costs of choosing not to go ahead. The Catalonian health authority said Wednesday it saw no need for such an event to be canceled.Spanish radio station Cadena Ser reported that GSMA has decided to continue preparations for MWC at least until Friday while it monitors the evolution of the virus.Two of the world’s biggest phone carriers -- Deutsche Telekom AG and Vodafone Group Plc -- earlier on Wednesday joined major exhibitors such as Nokia Oyj, Ericsson AB and Sony Corp. in pulling out of MWC. Ericsson’s absence alone left a gap bigger than a standard American football field in the conference halls.A decision to abandon the gathering for the first time in its 33-year history would underscore how the continued spread of the virus from its origin in China is denting business activity around the world. The death toll in China rose to 1,113 as of Feb. 11, and confirmed cases on the mainland have reached 44,653.Liberty Media Corp.’s Formula One on Wednesday postponed the Chinese Grand Prix, due to be held in April. Scores of companies and VIPs have pulled out of the Singapore Airshow, the industry’s biggest in Asia, scheduled for this week.MWC is due to run from Feb. 24 to Feb. 27, drawing around 100,000 people to the Spanish city. It’s the industry’s most important opportunity for networking and a chance to show off the latest gadgets and software to buyers from across the world. Wireless equipment vendors use MWC to hammer out deals with their biggest customers. Were the event to go ahead, it would be a shadow of its former self.5G ShowcaseThe GSMA stepped up sanitary precautions in recent days to reassure visitors -- advising against handshakes, introducing body temperature scanners and a protocol for changing microphones, and restricting entry to recent arrivals from China.That’s not been enough to reassure many participants given the potential for virus transmission at an event where thousands of visitors jostle through packed exhibition halls and huddle in meeting rooms.In a statement to Bloomberg, the GSMA said Wednesday it was meeting regularly with health experts and partners “to ensure the wellbeing of attendees,” and will continue to seek medical advice on a frequent basis. A representative for the industry body declined to comment further.The biggest MWC participants often spend tens of millions of dollars to exhibit at the show. The GSMA funds much of its budget from the event, charging 799 euros ($872) for a basic admissions pass.This year is supposed to see the big launch for fifth-generation mobile services that debuted in 2019. The smartphone industry is trying to fire up stalled growth with the promise of higher data speeds and faster responsiveness. Smartphone shipments have been declining since 2016.MWC is also important to the city of Barcelona, as well as to many of the smaller companies that wouldn’t otherwise have access to such a large audience of mobile carriers and consumers. Large national contingents from Turkey to South Korea take to the show to encourage deal-making and inward investment.\--With assistance from Stefan Nicola, Angelina Rascouet, Daniele Lepido, Thomas Gualtieri, Nate Lanxon and Charles Penty.To contact the reporters on this story: Loni Prinsloo in Johannesburg at firstname.lastname@example.org;Thomas Seal in London at email@example.com;Rodrigo Orihuela in Madrid at firstname.lastname@example.orgTo contact the editors responsible for this story: Rebecca Penty at email@example.com, Jennifer RyanFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Announcement of Periodic Review: Moody's announces completion of a periodic review of ratings of Hellenic Telecommunications Organization S.A. Madrid, February 12, 2020 -- Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Hellenic Telecommunications Organization S.A. and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers.
Spanish health officials said on Wednesday there was no reason to cancel the Mobile World Congress in Barcelona over coronavirus fears, despite major companies pulling out of the event. National Health Minister Salvador Illa said the government's goal was protecting people's health, but that it would take additional measures if necessary. The assurance came after behind-the-scenes pressure on Spanish authorities to declare that holding the event in Barcelona would pose a public health risk, which could potentially in turn trigger a payout on any event insurance taken out by the organisers.
The organisers of the Mobile World Congress (MWC) said on Wednesday they were monitoring "the fast-changing" development of the coronavirus, in a statement issued after sources said the event in Barcelona was likely to be called off. "We have already implemented additional health measures ahead of MWC 2020 and will continue to seek expert medical advice on a frequent basis," it added.
Telecoms industry lobby GSMA will hold a virtual board meeting on Wednesday to discuss a major conference later this month which is looking increasingly threatened by fears of coronavirus, a person with knowledge of the matter said. Board members of the GSMA will discuss the Barcelona conference by phone at 1300 GMT, according to the person, who declined to be named.
BARCELONA/BERLIN/PARIS (Reuters) - The Mobile World Congress (MWC), the annual telecoms industry gathering that draws more than 100,000 visitors to Barcelona, was canceled on Wednesday after a mass exodus by exhibitors due to fears over the coronavirus outbreak. Bowing to the inevitable, the GSMA telecoms association that hosts the get-together said it had canceled the Feb. 24-27 event despite assurances from local and national health officials that it would have been safe to hold it. "The GSMA has canceled MWC Barcelona 2020 because the global concern regarding the coronavirus outbreak, travel concern and other circumstances, make it impossible for the GSMA to hold the event,” John Hoffman, the CEO of organizer GSMA, said in a statement.
T-Mobile US Inc may be limited in its ability to trim the price of its $40 billion acquisition of Sprint Corp after it overcame regulatory obstacles to completing the deal, investors and analysts said on Tuesday. Before it is completed, T-Mobile's German parent, Deutsche Telekom AG, plans to ask Sprint's majority owner, Japan's SoftBank Group, to agree to a lower price, arguing that Sprint's fortunes have deteriorated following their agreement two years ago, sources told Reuters on Monday. Sprint shares were trading at around $8.3 on Tuesday, a 14% discount to the $9.6 per share price that the all-stock deal with T-Mobile assigns Sprint.
Major U.S. and European stock indexes surged to fresh records on Tuesday after China's senior medical adviser suggested the deadly coronavirus may be over by April, an outlook that also helped crude prices gain on hopes of renewed Chinese demand. China's foremost medical adviser on the outbreak told Reuters the number of new cases was falling in some places and forecast the epidemic would peak this month.
Moody's Investors Service said that the ratings of T-Mobile USA, Inc. (T-Mobile, Ba2 stable) and Sprint Corporation (Sprint, B2 review for upgrade) remain unchanged following the outcome of antitrust litigation brought by attorneys general of 13 states and the District of Columbia (state AGs group). The trial began on December 9 in the New York federal court before Judge Victor Marrero and concluded with a decision filed today. Judge Marrero concluded that the merger between T-Mobile US, Inc. (T-Mobile US), the parent of T-Mobile, and Sprint was unlikely to weaken wireless competition and that DISH Network Corporation (Dish, Ba3 review for downgrade) would be viable as a new wireless carrier to maintain sufficient competition in the industry.
European stocks rebounded on Tuesday in a broad-based advance, with the travel sector rallying as tour operator Tui demonstrated how it has benefited from the collapse of a rival.
(Bloomberg) -- T-Mobile US Inc. is poised to close its long-sought merger with Sprint Corp., a deal that will reshape the U.S. wireless industry, after winning approval from a federal judge who rejected a state lawsuit against the tie-up.The two companies said Tuesday they expect to close as soon as April 1 after U.S. District Court Judge Victor Marrero in Manhattan said the states failed to persuade him that a merger of the No. 3 and 4 carriers would harm consumers.“Today was a huge victory for this merger,” T-Mobile Chief Executive Officer John Legere said in a statement. “We are finally able to focus on the last steps to get this merger done!”The ruling comes almost two years after the merger was announced. The companies had bet on a favorable reception from the Trump administration, which signed on to the deal last year. Regulators under President Barack Obama in 2014 rebuffed an earlier merger proposal out of fear that consolidating the market would lead to higher prices.Now the tie-up will give T-Mobile added heft to take on industry leaders AT&T Inc. and Verizon Communications Inc. The new T-Mobile will overtake AT&T in total number of regular monthly subscribers.For T-Mobile’s parent company, Deutsche Telekom AG, the deal reduces the German company’s reliance on Europe, where carriers are struggling to grow amid fierce competition and where its biggest rival -- Vodafone Group Plc -- bolstered its position by buying continental cable assets from Liberty Global Plc. T-Mobile’s importance for Deutsche Telekom has grown steadily in recent years and currently accounts for about half of group sales, up from about a third in 2014.Approval of the deal will come as a huge relief for Sprint parent SoftBank Group Corp. and its chairman, Masayoshi Son, who had faced the prospect of having to bail out Sprint if the deal were blocked. Now, the entrepreneur can better plug SoftBank as a technology investment powerhouse, allowing him to focus his energies on the $100 billion Vision Fund.Shares of Sprint soared 74% to $8.33 at 9:56 a.m. in New York from Monday’s closing price of $4.80. T-Mobile gained 11% to $94.13.T-Mobile and Sprint haven’t renewed the merger agreement since it lapsed on Nov. 1. T-Mobile has suggested there could be new terms, including on the price. Before the merger can close, it still needs approvals from California’s utility board and a federal judge in Washington who must sign off on the Justice Department’s settlement allowing the deal.In his decision, Marrero rejected key arguments from the states: that the merged company would raise prices for lower quality service and that Sprint could remain as a viable competitor without the merger.“T-Mobile has redefined itself over the past decade as a maverick that has spurred the two largest players in its industry to make numerous pro-consumer changes,” the judge wrote. “The proposed merger would allow the merged company to continue T-Mobile’s undeniably successful business strategy for the foreseeable future.”Consumer advocates blasted the decision as dangerous for wireless subscribers even with a settlement approved by federal regulators that envision Dish Network Corp. entering the market as a new wireless competitor. With the core satellite-TV business in decline, Charlie Ergen, the Dish co-founder and chairman, has amassed a trove of airwaves to build a state-of-the-art wireless network.“Going from four established nationwide wireless networks to only three -- with the possibility that we might someday, eventually, get some version of a fourth network added back into the mix -- will be extremely damaging to competition,” George Slover, senior policy counsel at Consumer Reports, said.Marrero’s ruling is a major setback for New York Attorney General Letitia James and her California counterpart, Xavier Becerra, who led the litigation for states representing more than 40% of the U.S. population. James said in a statement her office is considering an appeal.“From the start, this merger has been about massive corporate profits over all else, and despite the companies’ false claims, this deal will endanger wireless subscribers where it hurts most: their wallets,” she said.The states argued without success that the merger would lead to billions of dollars in extra costs for consumers, with wireless customers in urban areas being hit particularly hard. They also said the deal wouldn’t work out as planned because Dish was unlikely to be able to follow through on its commitments to become a viable wireless competitor.During the two-week trial, Marrero at one point expressed doubt that the new T-Mobile would “be so bold” as to raise prices after the merger without also offering better service, pushing back on testimony by an expert hired by the states who predicted that customers of the four biggest providers could see combined increases of as much as $8.7 billion, with $4.6 billion from T-Mobile alone.The defense also presented evidence that Sprint couldn’t survive without the deal. Legere had testified that Sprint would be “sold for parts” if the merger didn’t go through.The states’ lawsuit was the last major hurdle to the deal after it was approved by regulators at the Federal Communications Commission and the Justice Department’s antitrust division. The states that sued had urged Marrero after the trial not to give any extra weight to the federal government’s decision, calling the government’s review of the deal “cursory.”\--With assistance from Chris Dolmetsch and Stefan Nicola.To contact the reporters on this story: David McLaughlin in Washington at firstname.lastname@example.org;Scott Moritz in New York at email@example.com;Erik Larson in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: David Glovin at email@example.com, ;Sara Forden at firstname.lastname@example.org, ;Nick Turner at email@example.com, Joe Schneider, Paula DwyerFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- T-Mobile US Inc. won court approval for its $26.5 billion takeover of Sprint Corp., defeating a state-led lawsuit that sought to block the industry-altering wireless deal.The decision by a district judge in Manhattan is a huge win for T-Mobile and its owner Deutsche Telekom AG, as well as SoftBank Group Corp., Sprint’s parent. The combined company, which will operate under the T-Mobile name, will have a regular monthly subscriber base of about 80 million -- in the same league as AT&T Inc., which has 75 million subscribers, and Verizon Communications Inc., which has 114 million.After the merger, T-Mobile will have more spectrum -- the frequencies through which wireless signals are transmitted -- than any other carrier. This larger capacity will give the combined company an advantage as the industry transitions to the next generation of wireless technology, the much-faster 5G standard.The ruling comes almost two years after the deal was first announced. The states’ lawsuit was the last major hurdle to the deal after it secured the blessing of regulators at the Federal Communications Commission and Justice Department’s antitrust division. It still needs approvals from California’s utility board and a federal judge in Washington who must sign off on the Justice Department settlement.Deutsche Telekom shares rose as much as 3.6% to 15.40 euros in Frankfurt. Shares of Sprint soared 66% to $7.95 in pre-market trading in New York after closing at $4.80 Monday in New York. T-Mobile extended gains to as much as 8.4% to $91.88.The ruling is also a victory for Dish Network Corp. co-founder and Chairman Charlie Ergen, who is buying assets from the two carriers to set up a new wireless network. With his company’s core satellite TV business in decline, Ergen has amassed a trove of airwaves to build a state-of-the-art network.ConcessionsTo win federal approval, T-Mobile and Sprint had agreed to sell multiple assets to Dish in order to create a new fourth competitor. The new Dish wireless network will start life with about 9 million subscribers.T-Mobile and Sprint haven’t renewed the merger agreement since it lapsed on Nov. 1. And while there have been “not hostile” discussions of several issues, including price, T-Mobile has suggested there could be new terms.T-Mobile Chief Executive Officer John Legere said last week he was still optimistic that the deal would go through, though the terms could change. If the agreement needs to be amended, “including possibly price, we would handle that very swiftly after the deal was approved,” he said.As far as negotiation leverage goes, Sprint’s in a tough spot, said Walt Piecyk, an analyst with LightShed Partners. “Sprint has no alternative but to take whatever DT and T-Mobile offers them,” he said. “There’s really nothing else they can do.”T-Mobile and Sprint had been the most aggressive U.S. wireless companies in terms of price competition in recent years, forcing AT&T and Verizon to follow moves like ending service contracts and adopting unlimited data plans. The proposed combination came under fire from lawmakers and consumer advocates who said it would lead to higher prices and fewer services, especially for poor and rural consumers.The companies had pursued a combination for several years, but a proposed deal was twice rejected as anti-competitive under the previous administration. After the FCC approved the deal, the all-Democratic group of attorneys general filed suit. The Justice Department then gave its approval, leading to a rare split between states and the federal government over antitrust enforcement.“This is exactly the sort of consumer-harming, job-killing mega-merger our antitrust laws were designed to prevent,” New York Attorney General Letitia James said at the time.Tackling ConcernsLegere tried to address these concerns by promising to not raise prices for three years. He is credited with helping to remake T-Mobile into an industry maverick, and pitched the Sprint takeover as a way to compete against industry leaders Verizon and AT&T.Legere announced in November that he will be handing off the job to Chief Operating Officer Mike Sievert in May, but plans to remain on the combined company’s board.One of their central pitches was that the deal would advance the introduction of 5G. The companies pledged to FCC Chairman Ajit Pai in May that they would deploy a 5G network covering 97% of the U.S. population within three years and 99% within six.(Updates share prices in fifth paragraph)\--With assistance from Stefan Nicola, Chris Dolmetsch and Courtney Dentch.To contact the reporters on this story: David McLaughlin in Washington at firstname.lastname@example.org;Erik Larson in New York at email@example.com;Scott Moritz in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Sara Forden at email@example.com, ;Nick Turner at firstname.lastname@example.org, Rob Golum, Jennifer RyanFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.