Newly-appointed T-Mobile USA CEO John Legere promised a new era of competition for the Bellevue wireless carrier when he took over the helm last month. Now, we’re getting a possible look inside what he meant.
Bloomberg reports today that Deutsche Telekom, the parent company of T-Mobile USA, is in negotiations to buy Richardson, Texas-based MetroPCS Communications. The report, which cites people with the knowledge of the matter, notes that Deutsche Telekom’s board plans to meet in Bonn, Germany tomorrow to discuss the transaction and could announce a deal as early as this week. Bloomberg earlier this year reported on the possibilities of a T-Mobile-MetroPCS tie up.
MetroPCS would add 9.3 million prepaid customers to T-Mobile, which is the country’s fourth largest wireless carrier with 33.2 million subscribers. As part of the transaction, the combined entity would be publicly-traded. A provider of no contract, unlimited, flat-rate wireless service, MetroPCS grew revenues by six percent during the second quarter to $1.3 billion on net income of $149 million.
MetroPCS already is traded on the New York Stock Exchange under the ticker PCS. Shares of the company are up more than 18 percent in trading today, giving it a market value of nearly $5 billion. The stock is up more than 56 percent in the past year.
If the deal occurs, it would follow the announcement earlier this week that T-Mobile planned to sell the rights to its cell towers to Houston-based Crown Castle for as much as $2.4 billion. It would also follow the disintegration late last year of the AT&T’s $39 billion bid to buy T-Mobile.