After months of battle and negotiations, the third and fourth largest wireless carriers in the U.S.A. finally agreed on a merger.
The fusion between the two companies is one of massive proportions in terms of capital and clients, as it will be a $26 billions all-stock deal and will concern 127 millions customers.
The main goal of this deal is to give birth to a strong opponent to AT&T and Verizon.
Actually, the announcement might be due to T-Mobile’s fail to acquire a company called Straight Path a year ago, that focuses on providing technology, in the 28 GHz z to 39 GHz millimetre wave spectrum. Verizon, who won the bid gets an advantage in the 5G market.
In order to be competitive in this new 5G technology the merger became necessary.
T-Mobile and Sprint tried to merge 7 years ago, in a much different environment and the failed, as the Obama administration opposed it. They hope this time, the situation will be different.
Still, nothing is done yet, as the two companies need to convince the US regulators and antitrust enforcers. The market also have doubts about their capacity of convincing as Sprint’s share went down 15.3% and T-Mobile US slipped at 7.6%.