T-Mobile acquires Sprint worth $ 26 billion

UNITED STATES (OBSERVATORY) –┬áThe merger, the third and fourth largest mobile telecommunications company in the United States, aims to create a more competitive company, used by about 130 million people.

The deal, however, is expected to be scrutinized by US regulatory authorities to examine its potential impact on consumer prices.

John Leger, president of T-Mobile, said the new company would spend about $ 40 billion to build a fifth-generation cellular network over the next three years.

“Together we will build the largest cellular communications company in the history of the US I am talking about a company that is about 30 times bigger than T-Mobile today,” Leger said in one of Twitter’s tweets.

The deal followed months of negotiations between Deutsche Telekom, owner of T-Mobile, and Japan’s Softbank Group, owner of Sprint.

According to the deal, Deutsche Telekom will own 42 percent of the new company and control its board of directors while Softbank owns 27 percent.

Mr Leger is due to lead the new company, T-Mobile, with a market value of about $ 146 billion.

Concerns about competitiveness

T-Mobile and Sprint have been locked in merger negotiations since 2014, when the administration of former US President Barack Obama blocked a previous merger attempt over concerns about competitiveness.

Under the Trump administration, telecom regulators continued to block deals they believe could cause price increases, and the recent takeover is likely to be closely scrutinized.

The US Justice Department is currently trying to block a deal by AT & T for the $ 85 billion acquisition of Time Warner, warning that the deal “will make consumers all over America worse off.”

Leger, president of T-Mobile, said the merger between Sprint and T-Mobile would cut prices and help the United States speed up the development of the fifth-generation mobile communications, with strong competition from China.

Leger said the deal would create tens of thousands of jobs in rural America, which analysts believe may affect Trump’s position on the deal.