T-Mobile and Sprint — after months of negotiations — have officially ended their talks on a proposed merger, announcing in a joint statement Saturday that they were “unable to find mutually agreeable terms.”
Both companies have fought to take on the two biggest U.S. wireless carriers, AT&T and Verizon Wireless — and by teaming up would have represented a powerful No. 3 player in the mobile biz with more than 120 million customers total.
The chief execs of Sprint and T-Mobile both said they still see the benefits of combining but indicated the talks broke down over financial terms. The sticking point, per reports earlier this week, was that Japan’s SoftBank, majority owner of Sprint, and T-Mobile’s German parent Deutsche Telekom each wanted to have control over the combined entity.
“The prospect of combining with Sprint has been compelling for a variety of reasons, including the potential to create significant benefits for consumers and value for shareholders,” John Legere, president and CEO of T-Mobile, in a statement. “However, we have been clear all along that a deal with anyone will have to result in superior long-term value for T-Mobile’s shareholders compared to our outstanding standalone performance and track record.”
Sprint president and CEO Marcelo Claure said: “While we couldn’t reach an agreement to combine our companies, we certainly recognize the benefits of scale through a potential combination. However, we have agreed that it is best to move forward on our own. We know we have significant assets, including our rich spectrum holdings, and are accelerating significant investments in our network to ensure our continued growth.”
T-Mobile has been particularly aggressive and successful in challenging its two larger rivals, branding itself as the “Un-carrier.” T-Mobile moved its standard offering to unlimited-usage plans earlier this year, prompting AT&T and Verizon to introduce similar plans. And in September, T-Mobile launched a new subscriber perk: a free standard Netflix subscription for customers with at least two lines on an unlimited family plan.
As of the end of the third quarter of 2017, T-Mobile had 70.7 million subscribers and Sprint had 54 million. They trail the two sector leaders: Verizon had more than 144 million total U.S. wireless subscribers and AT&T had 138.8 million as of the end of September.