If you follow the telecommunications space at all than you know that merger acquisitions are always floating around. However, a new merger rumour seems to have some truth behind it. A recent report by the Wall Street Journal revealed that merger talks between Sprint and T-Mobile were back on again.
For those keeping score, this marks the third round of merger talks between Sprint and T-Mobile. So make of this report what you will. You will likely recall that the first time this merger was discussed ended in 2014 after the U.S. federal government made it clear that they would frown upon such a merger. With a new administration in power, now might be the time these companies have been waiting for. Only time will tell but whether these talks lead to an actual merger or not, the mere fact that they are back on sent both companies shares way up.
According to the most recent numbers, Sprint saw shares rise close to 25 percent, while T-Mobile saw their shares rise eight percent. The rise in value is understandable given the fact that if this merger were to go through the combined companies would boast approximately 100 million wireless customers. That would land them solidly in the number two telecommunications spot–behind AT&T but ahead of Verizon Wireless.
Of course, the fact that the two companies are talking in no way means that a deal will actually be reached, as the Wall Street Journal itself took care to point out. For now all we can do is speculate.
Sources:
https://www.multichannel.com/news/sprint-t-mobile-shares-soar-on-merger-speculation
