Dish and T-Mobile to merge?
June 4, 2015
Dish Network and T-Mobile US are reportedly in talks about a possible mega-merger that would combine two large companies from the television and communications industries with market capitalizations that top $30 billion each.
The Wall Street Journal cited sources familiar with the negotiations on Thursday as saying both sides were "in close agreement" about the combined company's organizational structure but they haven't nailed down a purchase price for the deal yet.
The newspaper's sources said there was no guarantee that the deal wouldn't ultimately fizzle out, but added that if things went as planned, Dish's current chief executive, Charlie Ergen, would become the new company's chairman and his T-Mobile US counterpart, John Legere, would act as CEO.
The deal would likely face less scrutiny from regulators who have in the past been adamant about upholding competition in the communications industry. The US government has made very clear that it will not tolerate fewer than four national wireless carriers, but the deal between Dish and T-Mobile US would involve firms from different industries and could give the US' fourth-largest wireless carrier a powerful boost.
Both companies stand to gain significantly from the deal. Dish has spent billions of dollars acquiring licenses to use wireless airwaves but it doesn't (yet) have the cellular networks necessary to use them. A fusion with T-Mobile US would help in that respect.
T-Mobile US has 44.7 million subscribers and has been outpacing its competitors in the number of new customers it has added recently. Dish's wireless licenses would prove very useful to boost its network capacity.
If a deal is reached, it would be the latest multibillion-dollar fusion between heavyweights in the television and communications industries. T-Mobile's rival AT&T is close to inking a deal with Dish rival DirecTV for $49 billion (43.6 billion) that would create the country's largest pay-TV operator. Additionally, Charter Communications has completed a string of deals worth $67 billion that would combine Time Warner Cable and Bright House Networks, forming the nation's second-largest cable company.