Sprint reportedly walks away from MetroPCS merger

Sprint, the third biggest wireless provider in the US, was perhaps the single biggest opponant of the proposed merger between AT&T and T-Mobile. In the end, those two companies decided to break off their merger plans, thanks in part to pressure from Sprint and other parties including the federal government, who claimed that such a deal would cut down on competition in the wireless business.

Now a new report claims that Sprint has called off a major merger deal of its own and it's one that hasn't been made public. CNBC first broke the news on Friday that Sprint decided against a merger deal with MetroPCS: fifth largest wireless carrier in the US with over 9 million subscribers.

According to the story, which has yet to be confirmed officially by Sprint and MetroPCS, talks between the two companies have been underway for months and Sprint's CEO Dan Hesse reportedly gave his approval to the deal. It was supposed to be officially announced sometime next week.

The merger would have given MetroPCS shareholders shares in Sprint also with some cash for a deal that would have been worth about $8 billion. However, for reasons that have yet to be reported, Sprint's board of directors apparently voted not to go ahead with the MetroPCS merger.

Sprint is still struggling to fight off both Verizon and AT&T, both of which are now busy building their 4G LTE networks. Sprint is well behind on its own 4G plans although it has stated it will being launching its own LTE network later in 2012.

Report a problem with article
Previous Story

Nokia tells world to expect “significant industry news” on Monday

Next Story

First Mass Effect 3 space trips end up in the trees

8 Comments

Commenting is disabled on this article.

I wonder why it folded... Sprint needs to do something to be able to compete and sustain their market presence... It's a shame they completely squandered the Nextel merger...

M_Lyons10 said,
I wonder why it folded... Sprint needs to do something to be able to compete and sustain their market presence... It's a shame they completely squandered the Nextel merger...

The Nextel merger is what almost killed them. Also, it absolutely destroyed their ability to provide decent customer service.

In a way, I am hoping Sprint and T-mobile survive. At&t and Verizon are out of control and cheating their customers. If T-mobile and Sprint fold, we are in serious trouble people.

JSYOUNG571 said,
In a way, I am hoping Sprint and T-mobile survive. At&t and Verizon are out of control and cheating their customers. If T-mobile and Sprint fold, we are in serious trouble people.

^This!

JSYOUNG571 said,
In a way, I am hoping Sprint and T-mobile survive. At&t and Verizon are out of control and cheating their customers. If T-mobile and Sprint fold, we are in serious trouble people.

Agreed. This is why I was so against the AT&T / T-Mobile merger...

Scorbing said,
I wouldn't be surprised if MetroPCS buys Sprint one of these days!

With their cash and debt problems, I wouldn't be either.

Mr. Black said,
With their cash and debt problems, I wouldn't be either.

Agreed. The Craig McCaw way happens to epitomize much of what's wrong with American business today.

He built McCaw Cellular on junk bonds and rubbed shoulders with Michael Milken. Managed to sell out to AT&T Wireless, thereby becoming a much-hyped guru of the cellular industry. But everything that he's done since then has shown that the emperor has no clothes. Nextel. Sprint Nextel. Clearwire.

You cannot build a solid company on the back of crushing debt load, especially when your competitors have robust cash flow and solid financing. You should not rescue a company by throw Hail Mary passes. (The recent deal with Apple comes to mind.)

In contrast, MetroPCS has taken a different approach. They have been careful to expand within their means. Their footprint has remained smaller than the Big Four, but at least they're not hemmorhaging money like Sprint.