Waiting for the magenta pin to drop

T-Mobile, once wooed to no avail by AT&T, perhaps will now be courted by Sprint:

Sprint is mulling a potential bid for rival wireless carrier T-Mobile, according to a new report.

The report comes from The Wall Street Journal, citing “people familiar with the matter.” According [to] the Journal, the company is “studying regulatory concerns” and it could be prepared to make an offer as soon as the first half of 2014.

A Sprint/T-Mobile merger would pair the United States’ third and fourth largest carriers into an entity that could better compete against the two largest carriers, AT&T and Verizon. A Sprint/T-Mobile merger is something Sprint executives have sought for many years. Over the last year, in the wake of the failed AT&T/T-Mobile merger, executives from both companies have gone on record arguing that a merger should be allowed.

This is presumably relevant to Deutsche Telekom’s interests, one of which has been to get the heck out of the US market entirely. There’s this bit of fine print in the T-Mobile/MetroPCS merger from earlier this year:

In its agreement to merge the fourth-largest U.S. wireless carrier with MetroPCS Communications Inc., Deutsche Telekom pledged not to sell shares of the listed carrier on the stock market for 18 months. The German company holds a 74 percent stake in the company, which has a market value of $14.2 billion.

“There is an exception clause in the contract regarding the lock-up,” said [Timotheus] Hoettges, who will take over as Deutsche Telekom’s chief executive officer next year. “We are in a position to sell all shares in one go.”

“Why not take all of me?” sings TMo.

The T-Mobile/MetroPCS merger received regulatory approval in March, so the 18-month window closes in September 2014. Market cap is currently about $23 billion.

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