T-Mobile and Sprint come closer to finalising merger
T-Mobile and Sprint will join forces to become one of the largest phone companies in the world.
T-Mobile and Sprint are closer to completing their merger. The two phone companies are set to have their financial union approved by a US national security panel. The joint venture between the two corporations is expected to be completed by early 2019. T-Mobile’s purchase of Sprint is worth $26 billion.
How Huawei was obstacle to merger
T-Mobile and Sprint dropped the controversial phone brand, Huawei, before they complete their merger. Huawei has been in the news recently for the arrest of its chief financial officer (CFO),Meng Wanzhou. The US ordered the arrest amid the belief that the company is being used by the Chinese government to spy on US customers.
To avoid controversy from the conflict between the US and China, the US government pressed T-Mobile’s owner, Deutsche Telekom, to drop the telecommunications company. The end of the deal for Huawei to add 5G to T-Mobile’s networks was one of the final hurdles before the arrangement is complete.
Deutsche Telekom previously noted that it would review its contract with Huawei.
'Deutsche Telekom takes the global discussion about the security of network equipment from Chinese vendors very seriously,’ said the company in a statement.
What the T-Mobile and Sprint deal could mean for customers
The merger between the two companies could signal more profits for them and faster service for customers. The combination of T-Mobile and Sprint would have the latest technology of a 5G network, bringing speedier Internet technology to a wider range of customers. The union of the two telecommunications giants could also lead to fewer options for consumers shopping for a phone carrier. Share prices of both corporations could rise as well. Investors will watch to see how the deal will ultimately play out. The merger still has to be approved by the US Department of Justice before it is finalised.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Live prices on most popular markets