Deutsche Telekom’s T-Mobile USA and MetroPCS will combine. The combined company will have around 42.5 million subscribers; Deutsche Telekom will hold a 74 percent stake in the combined company, while MetroPCS Communications’ shareholders will own the remainder and will also receive a payment of about $1.5 billion.
Deutsche Telekom recently tried to sell its U.S. business T-Mobile USA to AT&T for $39 billion. The Department of Justice and the Federal Communications Commission helped scrap the deal for regulatory reasons, though it did grant the German company a $6 billion breakup package.
“We are committed to creating a sustainable and financially viable national challenger in the U.S., and we believe this combination helps us deliver on that commitment,” said Deutsche Telekom CEO Rene Obermann.
The acquisition is scheduled to close in the first half of 2013. By the end of 2015, MetroPCS’s wireless network is expected to be shut down, and customers will be moved over to the new company.
U.S. Rep. Anna G. Eshoo, the ranking Democrat on the House subcommittee on communications and technology, noted that there needs to be another “strong national competitor” to Verizon Wireless and AT&T in the mobile the space. “The proposed merger of T-Mobile and MetroPCS has the right ingredients to provide consumers with a viable alternative for wireless voice and data service,” she said. “I hope the FCC and the Department of Justice will conduct a thorough, but swift review of the transaction’s merits.”
Source: Washington Post {link no longer active}
