Official Tmobile-Sprint merger discussion thread

[Brad The Beast]

4 minutes ago, IrwinshereAgain said:

I think that they would also have to buy the other 15 percent of the stock if they paid off the debt.  That is in the original purchase deal when they first bought. Sprint. 

What about the email from Masa saying he'd pay off all the debts? Apparently that's not the case or he was going to do some under the table dirty stuff. 

[IrwinshereAgain]

19 minutes ago, Brad The Beast said:

What about the email from Masa saying he'd pay off all the debts? Apparently that's not the case or he was going to do some under the table dirty stuff. 

Interesting point.  

[belusnecropolis]

3 hours ago, Brad The Beast said:

What about the email from Masa saying he'd pay off all the debts? Apparently that's not the case or he was going to do some under the table dirty stuff. 

Since then and now, many of his largest investments have soured quite a bit. He is still doing well in many areas in Asia, but after blowing through all those Saudi petrodollars in a year he is having a hard time finding more gas stations to invest in what appears to be his version of hookers and blow two point 0. He may not want to pay them anymore, or he may sell some more Yahoo Japan or Alibaba stock to cash out and take them private.

You never know what foreign billionaires will do next, let alone the ones we have here. Charlie Ergen made a website about this whole thing beginning with the Sprint sale; lamenting foreign money absorbing domestic companies. Now he is taking the stand for another group of billionaires that will all work for Masa. It's a clown world. 

[bigsnake49]

9 hours ago, RedSpark said:

Sprint can retrench if it wants to. A merger shouldn’t be granted to keep that from happening, especially given that Masa has always had the means to bail Sprint out on his own. If Masa wants to let Sprint retrench, I’m fine with that. I may have to take my business of 8 lines elsewhere, but so it goes.

If Masa had adequately supported Sprint by offsetting or completely negating its debt, it could have without a doubt been competitive with Verizon/AT&T, even with the comparatively low revenue flow it has versus the big two. Look what it’s been able to accomplish on “fuel vapors”.

The only time a merger should not be approved is if the resulting entity has too much power in the market place. Nothing else. The new T-Mobile will not have too much power it will barely have as many subs as Verizon and its revenue will fall far short of the big two since it does not have as many postpaid subs. All this bellyaching about prices is just that, bellyaching. Plus they did promise that they will not raise prices for three years.

Edited December 18, 2019 by bigsnake49

[Brad The Beast]

29 minutes ago, bigsnake49 said:

All this bellyaching about prices is just that, bellyaching.

Not quite. It's basic econ that reduced competition will lead to increased prices. Sprint's Chief Marketing Officer even said it would lead to higher prices. 

From this Bloomberg article:

Quote

A top Sprint Corp. executive thought a merger with T-Mobile US Inc. could lead to price increases across the wireless industry, contrary to public statements by the companies that prices will drop, according to evidence presented by states suing to block the deal on antitrust grounds.

Roger Sole, Sprint’s chief marketing officer, said in a text message in 2017 to Marcelo Claure, the carrier’s chief executive officer at the time, that the deal could mean an increase of $5 a month in average revenue per subscriber. Industry leaders AT&T Inc. and Verizon Communications Inc. would also benefit with fewer players in the market, he said.

“And they DO NOT pay anything for this,” Sole wrote to Claure. “The benefit of a consolidated market.”

 

[dkyeager]

If the merger is approved there is a huge amount of risk. The duo won' t stand still and certainly have enough money for counter attacks and more nefarious actions.  Technical and marketing missteps could also become quite costly.

[Brad The Beast]

I mean don't get me wrong. I think T-Mobile's 600MHz + Sprint's 2.5GHz would be a match made in heaven. But I know what the economic ramifications are likely to be which is why I don't want the merger to go through. I don't want to lose my SWAC plan and I know they're gonna take it 😭

[dkyeager]

$10 billion a reasonable start, but much more would be needed.

https://www.wsj.com/articles/dishs-ergen-says-banks-lined-up-to-loan-10-billion-for-wireless-network-11576627114

 

[dro1984]

7 hours ago, Brad The Beast said:

I mean don't get me wrong. I think T-Mobile's 600MHz + Sprint's 2.5GHz would be a match made in heaven. But I know what the economic ramifications are likely to be which is why I don't want the merger to go through. I don't want to lose my SWAC plan and I know they're gonna take it 😭

The merger has nothing to do with helping or hurting you there.    If they don't merge, I'm sure you will lose it anyway.   Sprint will be in a situation where they will not be offering fire-basement prices!  I think you, some of you, are routing against this for purely personal reasons.   

[RedSpark]

11 minutes ago, dro1984 said:

The merger has nothing to do with helping or hurting you there.    If they don't merge, I'm sure you will lose it anyway.   Sprint will be in a situation where they will not be offering fire-basement prices!  I think you, some of you, are routing against this for purely personal reasons.   

I’m against the merger because Masa clearly has the resources to revive and sustain Sprint, as he stated in his own words that he could pay off/down Sprint’s debt.

https://www.bloombergquint.com/onweb/sprint-can-survive-without-t-mobile-ex-ceo-claure-testifies

From that article:

”While T-Mobile and Sprint have cited the debt as a major reason why Sprint can’t survive on its own, the states presented email evidence demonstrating that that Sprint’s controlling owner, SoftBank Group Corp., was prepared to pay off Sprint’s debt if necessary. “If we need to pay back most or all of bonds, I’m willing to pay back all of those,” Masayoshi Son, the Tokyo-based technology conglomerate’s founder and and CEO, said in a Dec. 11, 2017 email to Claure.“

Masa’s inexplicable unwillingness to do so should not be absolved with a Merger that will have an anti-competitive effect on consumers.

[S4GRU]

38 minutes ago, RedSpark said:

I’m against the merger because Masa clearly has the resources to revive and sustain Sprint, as he stated in his own words that he could pay off/down Sprint’s debt.

 

Just because he can, doesn't mean he will.  And he doesn't mean he is required to.  He is thinking like an investor, not a philanthropist who is trying to find the best thing to serve the people, with his money.  Believe me, I am not defending him.  And he is not required to do with his money what you like, just because the government does not approve a merger (which they have already, by the way).  The last hurdle really is just the state's lawsuit.

I've never really been for the merger, anyway.  I've always said Sprint can go it alone.  Even when many here have vehemently disagreed with me.  And it really torques me to see Masa's quotes that he was always capable and prepared to fully financially bail out Sprint.  But basically let it languish intentionally as a better proposition to sell.

But the most likely scenario is he would still continue to try to sell Sprint and further let it languish EVEN if the merger fails to occur.  There are other suitors out there.  Probably DISH or cable cos.  Look how motivated Charlie Ergen seems to be.  He just can't sell to a U.S. mobile company T-Mobile's size or bigger.  That leaves just about everyone else in the world, except AT&T and Verizon.

I would say if this all fails and the merger doesn't go through, the odds of Masa doing what was said in that quote and magically pays Sprint debts and turns the yellow carrier into the Number One network is virtually nil.  So I wouldn't go hoping for it all to fail waiting for that scenario. 

As optimistic human beings, we have a tendency to extrapolate one sentence or idea into a full blown unrealistic personal fantasy.  Taking one general theme or idea, and then we automatically fill in every sub-supporting scenario with our wishes and decisions all magically supporting it.  Except it won't be your optimism that makes all those supporting decisions, it's Masa's desire to make as much money as quickly as possible and get rid of the investment that will be making those decisions.  Trust me, you won't like all his other decisions even if he did pay off the debt.  Masa has proven not to be a good owner from the customer's perspective.  Probably, the best thing is to hope for is Masa to sell.

For all my Charlie Ergen bashing, he doesn't seem so bad at the moment in context.  All hail the new king!  Any new king...

Robert

[bigsnake49]

48 minutes ago, dkyeager said:

$10 billion a reasonable start, but much more would be needed.

https://www.wsj.com/articles/dishs-ergen-says-banks-lined-up-to-loan-10-billion-for-wireless-network-11576627114

 

I could see them actually spending a little bit less since they don't need to put an enodeB or the equivalent in 5G parlance at every site. They could implement a C-RAN architecture with only the RRHs at each site. They also don't need to be a nationwide competitor, just nail the cities and larger towns.

[bigsnake49]

There was a time when I was driving on a Farm-To-Market road outside of Austin TX. Nothing but farmland for miles around. Yet I had Sprint signal, enough to make a phone call to my wife. And I thought how can Sprint make any money, not enough subscribers and there are 2 other companies here (T-Mobile did not cover this particular FTM road). I still have the same question.

Edited December 18, 2019 by bigsnake49

[Rawvega]

5 hours ago, RedSpark said:

I’m against the merger because Masa clearly has the resources to revive and sustain Sprint, as he stated in his own words that he could pay off/down Sprint’s debt.

https://www.bloombergquint.com/onweb/sprint-can-survive-without-t-mobile-ex-ceo-claure-testifies

From that article:

”While T-Mobile and Sprint have cited the debt as a major reason why Sprint can’t survive on its own, the states presented email evidence demonstrating that that Sprint’s controlling owner, SoftBank Group Corp., was prepared to pay off Sprint’s debt if necessary. “If we need to pay back most or all of bonds, I’m willing to pay back all of those,” Masayoshi Son, the Tokyo-based technology conglomerate’s founder and and CEO, said in a Dec. 11, 2017 email to Claure.“

Masa’s inexplicable unwillingness to do so should not be absolved with a Merger that will have an anti-competitive effect on consumers.

That's over two years ago though. Who's to say that say the Son is still willing or even able to do that in 2020? The business world isn't static, things change. There's a thread in this very forum questioning whether Softbank is in "deep doo-doo" due to the all of the money that Son has spent and investments that he's made.

[red_dog007]

Of course Son can pay off Sprint's debt.  Just in Alibaba alone Softbank owns $100+ billion.  He will only do it if it is required of him.  He will let Sprint CAPEX go to $0 though before he does such a thing.  

Son wanted to flip Sprint.  He read it poorly and is having a horrible time. Sprint isn't really hurting his books, but it is taking up way too much of his time and capital.  At this point, he would have been better off buying out 10yrs of Sprint's bonds and getting someone not Claure to run the company from the get go.  Then step back and give the CEO a little freedom.  

With debt cleared, more into capex, and a lot more freedom to operate, just the stock valuation alone I think Softbank would be up with Sprint.  

Edited December 18, 2019 by red_dog007

[RedSpark]

1 hour ago, red_dog007 said:

Of course Son can pay off Sprint's debt.  Just in Alibaba alone Softbank owns $100+ billion.  He will only do it if it is required of him.  He will let Sprint CAPEX go to $0 though before he does such a thing.  

Son wanted to flip Sprint.  He read it poorly and is having a horrible time. Sprint isn't really hurting his books, but it is taking up way too much of his time and capital.  At this point, he would have been better off buying out 10yrs of Sprint's bonds and getting someone not Claure to run the company from the get go.  Then step back and give the CEO a little freedom.  

With debt cleared, more into capex, and a lot more freedom to operate, just the stock valuation alone I think Softbank would be up with Sprint.  

I agree with you 100%.

Masa was arrogant about things with Sprint. He completely misread the politics for the Merger on the first attempt, got stuck with it and then didn’t fully appreciate the regulatory environment with respect to his monopole network plan, which then forced Sprint to revert to a traditional network build.

A merger isn’t meant to bailout this kind of thing, especially when he has the money.

[RedSpark]

https://www.advfn.com/stock-market/NASDAQ/DISH/stock-news/81387856/softbank-offered-to-help-fund-dish-wireless-networ
 

“SoftBank Group Corp. offered to help finance Dish Network Corp.'s construction of a new cellphone network intended to shore up competition if the merger of the nation's No. 3 and No. 4 wireless carriers closes, Dish's chairman said Wednesday”

It’s full on parody now. Straight up clown world. It was a lie. All of it.

[BlueAngel]

Wow...

[cyclone]

This case it starting to sound like an episode of Judge Judy. Son has not only been confirmed to be withholding funds to Sprint to make a merger more appealing, but he's also offered to fund the competition? Is it possible the courts can just order Son to pay a fine for wasting everyone's time and costing Sprint money?

[S4GRU]

7 minutes ago, cyclone said:

This case it starting to sound like an episode of Judge Judy. Son has not only been confirmed to be withholding funds to Sprint to make a merger more appealing, but he's also offered to fund the competition? Is it possible the courts can just order Son to pay a fine for wasting everyone's time and costing Sprint money?

No.  Because he is allowed to decide to merge his company with another, even for profit.  It is our form of government that decides that is a long process that costs lots of money.  And that's probably a good thing.  But it is what it is.  We don't have Pre-Approval Commissions who decide whether companies should be allowed to start a merger.  It doesn't work that way.  Not even in India, which is considered the most Bureaucratic country on earth.

Masayoshi Son didn't do anything wrong.  It's just not what we wanted him to do.  With his money.  Go figure.

Robert

[bigsnake49]

43 minutes ago, RedSpark said:

https://www.advfn.com/stock-market/NASDAQ/DISH/stock-news/81387856/softbank-offered-to-help-fund-dish-wireless-networ
 

“SoftBank Group Corp. offered to help finance Dish Network Corp.'s construction of a new cellphone network intended to shore up competition if the merger of the nation's No. 3 and No. 4 wireless carriers closes, Dish's chairman said Wednesday”

It’s full on parody now. Straight up clown world. It was a lie. All of it.

Misleading headline as usual. From the article:

"JPMorgan, one of the banks lined up this month to lend Dish cash, was offering to back the company even earlier. A June 27 email from a JPMorgan banker displayed in court Wednesday arranged for financing of Dish's purchase of Sprint prepaid brand Boost Mobile with SoftBank's support. 

Mr. Ergen said the company was seeking a $1 billion general-purpose loan at the time and thought the SoftBank assistance "would give us margin" because the Japanese investment company can borrow at a "much lower rate" that could save Dish $70 million to $100 million. The Justice Department also approved the funding arrangement, which remains contingent on the T-Mobile purchase of Sprint closing, Mr. Ergen added."

It's like somebody cosigning for you (your parents) so you can get a lower rate. Or taking out a loan for you because they have a better credit score and then loaning you the money for the same rate they got it. Softbank has been loaning Sprint money at a lower rates so they can refinance their debt so the interest payments can be lower.

Edited December 19, 2019 by bigsnake49

[bigsnake49]

17 minutes ago, S4GRU said:

No.  Because he is allowed to decide to merge his company with another, even for profit.  It is our form of government that decides that is a long process that costs lots of money.  And that's probably a good thing.  But it is what it is.  We don't have Pre-Approval Commissions who decide whether companies should be allowed to start a merger.  It doesn't work that way.  Not even in India, which is considered the most Bureaucratic country on earth.

Masayoshi Son didn't do anything wrong.  It's just not what we wanted him to do.  With his money.  Go figure.

Robert

Thank you Robert for enlightening some of these guys on what capitalism is all about. It is for investor to make money. It is not to bring you, the public, lower prices. Lower prices only come about only when the cost of labor goes down (imports), you have achieved great efficiencies and you want to steal customers from your competitors, you have too much merchandise in your warehouse or you can't compete in any other way. Unfortunately Sprint cannot compete in any other way. Between lower prices and having to pay your debt, there is not enough money to invest in your network. Lowering prices in the short term is fine but as a long term strategy leads to a spiral of death.

[belusnecropolis]

1 hour ago, RedSpark said:

Straight up clown world

Honk Honk 🤡🌎

[cyclone]

1 hour ago, S4GRU said:

Masayoshi Son didn't do anything wrong.  It's just not what we wanted him to do.  With his money.  Go figure.

 

58 minutes ago, bigsnake49 said:

Thank you Robert for enlightening some of these guys on what capitalism is all about. It is for investor to make money.

If Son didn't do anything wrong, Sprint would be buying T-Mobile. That was his plan all along, right? Instead he has made wrong choice after wrong choice. Now he's rummaging through the rules of the capitalist business playbook to get a ROI through this merger attempt by trying to attach himself to the combined entity to leech off it's assumed success. Should have just played the short game by setting up his direct purchase, Sprint, for success instead of playing the long game of merging. Isn't that how capitalism works? You spend money to make money?

[RedSpark]

8 minutes ago, belusnecropolis said:

Honk Honk 🤡🌎

Indeed indeed.

Remember that this whole merger process began years ago with Sprint trying to acquire T-Mobile... and here we are now, with T-Mobile acquiring Sprint. What a sham.