A report by The Wall Street Journal notes that Sprint may be readying a bid for T-Mobile. The company, which was recently bought out by Japanese carrier Softbank, is said to be working on a proposal to purchase T-Mobile outright from Deutsche Telekom. If successful, that would give the US three major carriers, and place Sprint in an immediate position of prominence.
The bid is said to be coming in the first half of next year, and could be worth upwards of $20 billion. Oddly, that’s roughly the amount Softbank bought Sprint for, merely one year ago. It’s also a number that makes little sense, considering that AT&T tried to buy T-Mobile for upwards of $40 million two years ago, which was shot down by regulatory officials.
The report also notes that Deutsche Telekom is attempting to exit the US market, and is willing to give up their 67% stake in T-Mobile altogether. With an 80% stake in Sprint, Softbank was always keen to grow their presence in the US, but understood it couldn’t end with that deal. If a merger were to happen between the two, it would also present the largest postpaid customer base in the US.
There are plenty of hurdles, though. T-Mobile is on an upswing, and growing their business rapidly. Their Un-carrier approach has proven wildly successful, drawing customers for the first time in a long time. Sprint is also a CDMA carrier, while T-Mobile operates on the more open GSM/HSPA technology. We also can’t see an offer for literally half the money T-Mobile commanded two years ago happening, especially considering their recent success, but stranger things have happened.