Mergers & acquisitions

Sprint & T-Mobile? Get Real

6:45 AM -- I'm intrigued by the suggestion that Sprint Corp. (NYSE: S) could buy T-Mobile US Inc. , a proposition that emerged in the wake of the U.S. Department of Justice trying to block the US$39 billion deal with AT&T Inc. (NYSE: T). (See DoJ Blocks AT&T/T-Mobile Merger.)

For instance, Politico put out a great summary of the whole AT&T/T-Mobile affair on Tuesday night, but the Sprint/T-Mobile merger suggestion came up in that piece too.

In all fairness, they shot it down very quickly, but when you look at the numbers I'm just not sure how anyone could take even the possibility seriously.

At the end of second quarter, Sprint had a total liquidity of $5.2 billion, that's $4.3 billion in cash, cash equivalents and short-term investments and its "$900 million of borrowing capacity available under its revolving bank credit facility."

Seems AT&T has set the bar a little too high for Sprint at $39 billion, doesn't it? Even if T-Mobile's valuation drops in the wake of the DoJ action, it's still going to be too rich for Sprint's pocketbook.

We don't even really need to go into how T-Mobile's existing GSM network won't work with Sprint's CDMA network and wholesale WiMax offering. We all remember how well and speedily it went when Sprint tried to combine its CDMA technology with Nextel's iDEN network, right? (See Sprint Nextel Preps Wireless BB.) — Dan Jones, Site Editor, Light Reading Mobile

sarahthomas1011 12/5/2012 | 4:54:33 PM
re: Sprint & T-Mobile? Get Real

Plus, if the FCC won't allow AT&T and T-Mobile to merge, it probably won't let Sprint and T-Mo do it either. Sprint's smaller, but the resulting dynamic is still similar.

joset01 12/5/2012 | 4:54:32 PM
re: Sprint & T-Mobile? Get Real

Yeah there's lots of obstacles, the money just seems to be the first hurdle they'd fall at.

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