Metro PCS shares fall 27% since deal announced, Sprint counterbid likely?

[bigsnake49]

The U.S. wireless industry is back in consolidation mode. But the spoils aren't going to all investors.

Since the start of the year, shares in Sprint Nextel, which Japan's Softbank agreed to buy control of in October, are up 133%. MetroPCS Communications, which Deutsche Telekom's T-Mobile USA is buying, is up only 15%.

 

Is T-Mobile getting a steal? T-Mobile agreed in October to a cash-and-stock merger with MetroPCS. The deal, including a planned $4.09 cash dividend but excluding synergies, valued MetroPCS shares at between $9.27 and $16, depending on the multiple applied, according to Sanford C. Bernstein. Include the company's projected $800 million in synergies, and that value reaches $11.84 to $19.51 a share.

Yet shares of MetroPCS closed Tuesday at $9.96. Indeed, the shares have fallen 27% since their closing price the day before the deal was announced.

The U.S. wireless industry is back in consolidation mode. But the spoils aren't going to all investors.

Since the start of the year, shares in Sprint Nextel, which Japan's Softbank agreed to buy control of in October, are up 133%. MetroPCS Communications, which Deutsche Telekom's T-Mobile USA is buying, is up only 15%.

 

http://online.wsj.co...0522987792.html

 

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Edited December 20, 2012 by bigsnake49

[WiWavelength]

Since the start of the year, shares in Sprint Nextel, which Japan's Softbank agreed to buy control of in October, are up 133%.

 

Craig Moffett must be rolling in his grave.

 

 

AJ

[kkstp09]

I think that if Sprint is going to make the move to take on Metro they are going to want to do it fast before anything is confirmed from T-Mobile and the government.

 

Once the combined T-Mo and Metro start merging networks - the value it has to Sprint lowers more and more because of network technology and the hassle of all the spectrum differences.

[S4GRU]

 

Craig Moffett must be rolling in his grave.

 

 

AJ

 

I do indeed picture him sleeping in a coffin placed in the center of a dark cold room in his Lower Manhattan high rise apartment.

 

Robert via Samsung Note II via Tapatalk

 

 

[WiWavelength]

I do indeed picture him sleeping in a coffin placed in the center of a dark cold room in his Lower Manhattan high rise apartment.

 

I thought we determined that Moffett has more of a Ron Perlman, Frankenstein-like look about him. Fire, bad! Sprint, bad! But I could go with the Dracula allusion, too.

 

 

AJ

[irev210]

Craig Moffett must be rolling in his grave.

 

 

AJ

 

He is writing a report as we speak about how damaged sprint was that they needed an ignorant foreign investor to try and save them.

 

 

Headline:

Sprint - unable to go it alone gets in bed with Japan's Softbank.

 

In a last act of desperation, Sprint, on the brink of bankruptcy...

 

I, Moffett-head called this. There was no way Sprint could keep going. They failed and I told everyone. Muahahahahaha!

[SGT516]

Should Sprint be interested in Metro PCS? To me, T-Mobile is just going to turn into a prepaid company down the road.

 

Sprint partnered with Softbank, will be getting control of Clearwire and has bought some of US Cellulars markets and customers.

 

I kind of like where Sprint is positioned right now.

[MacinJosh]

Sprint will finally be a competitive company in the market, and with enough spectrum capacity, could easily keep unlimited data for smartphones forever!

 

Sent from my Galaxy Nexus running Paradigm 3.0 using Forum Runner

[bigsnake49]

I don't think that they really want MetroPCS, they just want some extra PCS spectrum in markets where they only have 20MHz. So they might make a counteroffer just to scare T-Mobile and make them divest some PCS spectrum.

[Thomas L.]

I don't think that they really want MetroPCS, they just want some extra PCS spectrum in markets where they only have 20MHz. So they might make a counteroffer just to scare T-Mobile and make them divest some PCS spectrum.

 

Exactly. Sprint doesn't need another mess, they just need to top up their PCS spectrum - and realistically, T-Mobile will have so much PCS spectrum post-merger that it won't hurt them to do so. In addition, how would it look to regulators if Sprint went after MetroPCS and Clearwire both? It would really make things even more difficult.

 

Tommy

[ericdabbs]

Exactly. Sprint doesn't need another mess, they just need to top up their PCS spectrum - and realistically, T-Mobile will have so much PCS spectrum post-merger that it won't hurt them to do so. In addition, how would it look to regulators if Sprint went after MetroPCS and Clearwire both? It would really make things even more difficult.

 

Tommy

 

Yeah a MetroPCS and Clearwire would be a huge red flag that regulators would have to look at very carefully. Besides MetroPCS, I think Cricket has some nice PCS spectrum in the C block that would help several 20 MHz markets like Salt Lake City, Houston, San Antonio, Denver, Fresno, Albuquerque, Memphis, Nashville, Tulsa, Raleigh and Cincinnati if it were bought.

 

I really want to see Sprint get some PCS divestitures from a Tmobile/MetroPCS merger. There are far too many markets that still only have 20 MHz that need some major help in the PCS band since it currently supports CDMA, EVDO and LTE.