T-Mobile And Metropcs: A Multibillion-Dollar Merger

T-Mobile And MetroPCS Complete a Multibillion-Dollar Merger
Company and Situation

T-Mobile and MetroPCS have agreed to combine their struggling cellphone businesses in a deal aimed at letting them compete better with their three larger rivals. The combined company will use the T-Mobile brand and have 42.5 million subscribers. Although T-Mobile will stay No. wireless companies, it will get access to more space on the airwaves, a critical factor as cellphone carriers try to expand their capacity for wireless broadband.
The deal comes shortly after DT named John Legere as the new CEO of T-Mobile USA, who said he would be focused on growing the carrier's business, which has lost 1.7 million postpaid customers over the past 12 months to June 30.

Deutsche Telekom will own the remaining 74 percent of the new company. And therefore, at least for the time being, Deutsche Telekom will still control the shots. This means that you will have to get a new handset, since over time, T-Mobile would get rid of the old CDMA voice network, and replace it with a GSM network. But because this change will happen over several years, most people will probably naturally upgrade to a new phone that will work on the new network. And for those who aren't inclined to change handsets within a year or 18 months, T-Mobile will likely offer incentives. But the reality is that you will eventually have to upgrade your

Bloomberg reported Thursday that Sprint, which had been close to its own deal to buy MetroPCS earlier this year, is talking to advisers about whether it should offer a higher price to buy the company. If that happens and if MetroPCS is able to get out of its deal with Deutsche Telekom, then we could have an entirely new deal to evaluate. Although T-Mobile will stay No 4. wireless companies, it will get access to more space on the airwaves, a critical factor as cellphone carriers try to expand their capacity for wireless