Rebound romance

T-Mobile, having jilted its last suitor, is now rushing headlong into the arms of another:

Deutsche Telekom and MetroPCS said they will merge their U.S. mobile operations to create a larger fourth-place player better able to compete with rivals.

The boards of both companies voted on Wednesday to approve the deal, which will see Deutsche Telekom hold 74 percent and MetroPCS 26 percent in the combined entity.

MetroPCS, the #5 carrier in the States, is technically buying T-Mobile:

The deal is effectively a reverse merger, in which smaller MetroPCS, which is listed in the U.S, will buy T-Mobile U.S. The companies said the deal would be “structured as a recapitalisation” in which MetroPCS will declare a 1 for 2 reverse stock split and make a cash payment of $1.5 billion to its shareholders.

The combined company, which will be called T-Mobile and led by current boss John Legere, will have 42.5 million subscribers and pro forma revenues in 2012 of $24.8 billion.

This will put T-Mo in US stock exchanges, but won’t put it within shouting distance of #3 Sprint, which has 56 million subscribers. And I wonder just how much difficulty is added by the fact that MetroPCS is CDMA-based, while present-day T-Mo is purely GSM.


  1. McGehee »

    4 October 2012 · 7:30 am

    My wife and I were subscribers of a CDMA-based carrier when it was bought out by a GSM carrier. The new owners shut down the towers our phones depended on — without notice — and left us under contract but unserved for months.

  2. Barks in the Country »

    5 October 2012 · 8:23 am

    Where is the warning that these companies are going to be tortured by the FTC and the FCC for months on end?

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