Economy

SoftBank to end Sprint and T-Mobile merger talks

SoftBank to end Sprint and T-Mobile merger talks”

SoftBank Group plans to halt talks to merge USA unit Sprint Corp. with T-Mobile US because of disagreements over ownership of the combined company, Nikkei reported, without saying where it got the information.

The two companies came close to announcing a merger in 2014, but called it off at the last minute due to regulatory concerns.

Meanwhile, several members of SoftBank's board have raised concerns about giving up control of the U.S. wireless business, another person said. This time around, per a report by Japan's Nikkei, Son's SoftBank became concerned it would lose control should T-Mobile tmus take over Sprint.

Deutsche Telekom, based on Bonn, Germany, has maintained throughout the talks this year with SoftBank that it should maintain control of the combined company.

As a result of the news trading in Tokyo showed that SoftBank shares fell to 9,830 yen ($86) down 5.8% from Monday's closing price.

Deutsche Telekom and T-Mobile declined to comment.

One complicating factor in the talks is that Sprint shares have slumped in recent weeks, potentially hampering what Sprint shareholders could expect to receive in the deal, as the transaction was expected to give Sprint shareholders little or no premium beyond roughly their current value.

But Softbank, Sprint's owner, seems to have soured on the idea.

As of late Monday, T-Mobile still considered the negotiations with Sprint to be active, according to the sources.

A Deutsche Telekom spokesman had no immediate comment. Many saw the merger as the best move for Sprint, which has been struggling in a competitive wireless market. Verizon shares closed down 2.1 percent.

The two sides also have been unable to agree on a valuation for Sprint's shares, they added, though the talks still could be revived at a later date. Enter your email to be subscribed to our newsletter.



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