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Sprint stock dives 11% over report T-Mobile merger is off
T-Mobile and Sprint signage. The two companies are reportedly in merger talks.(Photo: Justin Lane/Erik Lesser, EPA-EFE)
The Japanese firm SoftBank, which owns
Sprint, plans to call off talks with T-Mobile about a merger of the two
wireless companies, according to the Nikkei Asian Review.
Shares of Sprint (S) fells 11.5% Monday
morning on the news. Trading of Sprint was briefly halted just after the
report was published. T-Mobile (TMUS) shares fell 4%.
According to the report, the giant Japanese technology
company ended its effort to become a major player in the U.S. wireless
market after Sprint and T-Mobile were unable to agree on how ownership
of the new company would be structured.
Nikkei reported that SoftBank planned to contact
T-Mobile-owner Deutsche Telekom as early as Tuesday about ending
negotiations. Representatives from SoftBank and T-Mobile could not be
immediately reached for comment.
SoftBank had hoped to combine the two carriers to
allow them to better compete against U.S. industry leaders Verizon and
AT&T.
In 2014, the nation's No. 3 and No. 4 wireless
providers considered joining forces; talk about the two companies
merging has escalated in recent months.
Masayoshi Son, the founder and CEO of Tokyo-based
telecom and Internet company SoftBank had long been looking for a deal
to improve Sprint's position.
Son reportedly also sought a merger of Sprint
and Charter Communications, but Charter rebuffed that. Still, in
August, Sprint CEO and President Marcelo Claure said the company would
have an announcement "in the near future" addressing merger discussions.
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