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Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

December 13, 2013 at 2:41 PM

Report: Sprint mulling purchase of T-Mobile in 2014

Sprint has been widely expected to make a move for T-Mobile US eventually. A report today suggests it will happen in early 2014.

The Overland Park, Kan.-based carrier is now looking into making that move in early 2014 and exploring whether the deal could be approved by regulators, according to a Wall Street Journal report today.

The report said Sprint could offer “more than $20 billion.” T-Mobile’s market capitalization was $20.1 billion Friday, when its stock jumped 8.6 percent to $27.64 after the takeover story emerged. An additional stake is held by parent company Deutsche Telekom.

If the deal goes through, it would likely be a blow to the Seattle area where thousands of people work directly or indirectly for Bellevue-based T-Mobile.

Unless Sprint decides to move its headquarters to Bellevue. That would make things more convenient for SoftBank, the Japanese company that’s now the majority owner of Sprint.

This area just experienced the downside of another Sprint takeover.

After Sprint completed its acquisition of the Bellevue-based Clearwire in July, it laid off most of Clearwire’s remaining employees. Instead of growing into a major regional company as originally envisioned, Clearwire was basically dismantled with its spectrum living on as a supplement to Sprint’s network.

Meanwhile, T-Mobile now is run by an executive who kept his home in New York, where he’s been warmly received by the New York  press. I wouldn’t be surprised if the company “pulls a Boeing” and moves the upper echelon of its headquarters eastward one of these days, if Sprint doesn’t buy it out first.

Further consolidation in the wireless industry is expected. Combining Sprint, the third-largest carrier, and T-Mobile, the fourth, would help both companies better compete with market leaders Verizon and AT&T.

But the Obama Administration raised concerns about the last big merger proposal, scuttling AT&T’s 2011 attempt to buy T-Mobile.

 

Comments | Topics: Phones, seattle, sprint

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