T-Mobile and Sprint have agreed their long-rumoured merger, costing T-Mobile around $26bn (£18.9bn) and placing the pair almost on par with the US mobile carrier duopoly of Verizon and AT&T. The deal, which will create a company with an enterprise value of around $146bn, is expected to close no later than the first half of 2019.
The combined company will be named as solely T-Mobile and will operate out of T-Mobile current headquarters in Bellevue, Washington – with a second headquarters in Overland Park, Kansas. John Legere, current president and CEO of T-Mobile, will maintain his role as CEO, while current T-Mobile COO Mark Sievert will serve as president and COO of the combined company. All remaining executive positions will be decided upon closure of the deal.
As a result of the deal, the joint company promises to lead the way on the rolling out of 5G network capabilities, helping to put the US at the forefront of the next mobile network evolution. Furthermore, it assures that there will be ‘lower costs, greater economies of scale, and unprecedented network capacity’.
“This combination will create a fierce competitor with the network scale to deliver more for consumers and businesses in the form of lower prices, more innovation, and a second-to-none network experience – and do it all so much faster than either company could on its own,” said Legere. “As industry lines blur and we enter the 5G era, consumers and businesses need a company with the disruptive culture and capabilities to force positive change on their behalf.”
The T-Mobile/Sprint company guarantees that it will create more jobs in the US than the two companies would have done separately. Upon completion of the merger, over 200,000 people will already be working for the company in the US – with plans to invest up to $40bn in the new network and business in the first three years, driving further job growth.
In addition to creating more jobs, the new company is promising to provide more wireless, broadband, and cable options for those in rural US communities, while creating more broadband options across the entire country. In addition, the company says it will provide serious competition for Verizon and AT&T when it comes to business and government customers.
“The combination of these two dynamic companies can only benefit the US consumer. Both Sprint and T-Mobile have similar DNA and have eliminated confusing rate plans, converging into one rate plan: Unlimited,” said Sprint CEO Marcelo Claure. “We intend to bring this same competitive disruption as we look to build the world’s best 5G network that will make the US a hotbed for innovation and will redefine the way consumers live and work across the US, including in rural America. As we do this, we will force our competitors to follow suit, as they always do, which will benefit the entire country. I am confident this combination will spur job creation and ensure opportunities for Sprint employees as part of a larger, stronger combined organisation.”