For the most part, things seem to be lining up rather nicely for the proposed merger of T-Mobile and MetroPCS. We have already seen all the necessary regulatory approvals which means that the Department of Justice, FCC and the Committee on Foreign Investment have all given the thumbs up. In fact, aside from a statement from Institutional Shareholder Services (ISS), we have seen very little in terms of opposition.
The ISS had issued a statement back in late-March that asked MetroPCS shareholders to “vote AGAINST the proposed transaction between PCS and T-Mobile USA.” This was then later acknowledged by P. Schoenfeld Asset Management LP (PSAM) who followed with a similar comment. The PSAM comment noted how they “are extremely pleased that ISS recognizes the Proposed Transaction between MetroPCS and T-Mobile is not in the best interests of PCS shareholders.”
Well, in what seems like an effort to sway the shareholders over to a vote of yes, it is now being reported that Deutsche Telekom is considering an improved bid. This latest bit has yet to be officially confirmed and instead is coming by way of The Wall Street Journal who are reporting based on”people familiar with the matter.” Basically, it is looking like Deutsche Telekom is working up a new plan that will involve a reduction in the amount of debt that will be transferred to the new company.
Part of the concern with the original plan was that it was included $15 million of intercompany debt owed to Deutsche Telekom being transferred into the new company. Further details from those sources suggest this new offer could be presented as early as today. Otherwise, the original offer has MetroPCS shareholders getting $4 a share in cash and a 26 percent stake in the new company.