June 5 - Sprint has agreed to pay $40 a share to buy T-Mobile US, according to sources, but some analysts say that combination would have slim chances of getting regulatory approval. Fred Katayama reports.
Sprint is betting it can win over skeptical regulators. A source says it has agreed to pay $40 a share for T-Mobile US. Such a deal valued at more than $32 billion would combine the U.S.' third and fourth largest carriers. The source says more details need to be worked out. But the deal could face huge regulatory hurdles. T-Mobile has been to the altar before. Regulators refused to bless its marriage to AT&T back in 2011, concerned that such a merger would raise prices for consumers. AT&T and Verizon Wireless dominate the U.S. market, and a Sprint/T-Mobile deal would leave the U.S. with just three major wireless carriers. But the wider telecom arena is consolidating. Comcast is trying to merge with Time Warner Cable; ditto AT&T with DirecTV. And that, a source says, could leave Sprint an also-ran if it doesn't take action. RBC analyst Jonathan Atkin says a Sprint/T-Mobile combination would have "narrow" chances of getting regulatory approval, noting that T-Mobile has been a "disruptive competitor and driven consumer-friendly rate reductions throughout the sector." He says don't be surprised if satellite service provider Dish Network were to bid for T-Mobile, adding that it would have a better shot at getting approved.