New Sprint Rumor

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| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

New Sprint Rumor

Engadget has a rumor that Deutsche Telekom is eyeing Sprint Nextel for acquisition. There are a number of issues here:
  1. DT owns T-Mobile.
  2. T-Mobile is GSM and Sprint is iDEN and CDMA. Not much value in mixing that many signaling protocols. No synergy.
  3. FTC and DOJ may not like that much Public Safety being foreign owned.
  4. The cost would be staggering.
By that I mean that DT isn't exactly experiencing huge growth to pay back a multi-billion dollar acquisition of a declining asset. And Sprint is declining. If DT did want to enter the US, it could have bought Virgin Mobile as a foothold. Or done a JV (joint venture) with SK Telecom. These would have been easier and cheaper acquisitions.

UPDATE: MarketWatch article about possible merger and Reuters notes the rise in Sprint's stock and bond prices on these rumors. From this you can almost feel that the bankers are floating a balloon to take advantage of the deltas.


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