T-Mobile and Dish Network Corp. are close to reaching a merger deal that would combine the companies' total market capitalization of over $60 billion. The terms and conditions of the marriage remain undetermined but the respective slots that top executive of both firms appear to have been agreed upon.
If the deal pushes through, T-Mobile CEO John Legere will get to keep his current post while Dish Network top honcho Charlie Ergen is poised for a chairmanship role, The Wall Street Journal reported, citing unidentified sources.
However, the same sources are quick to remind that the ongoing negotiations are "in the formative stage," and anything can still happen. The chance of the talks collapsing remains a possibility, the report noted.
Consolidation of the mighty
The Journal report also indicated that the agreement when realized will lead to a combined capitalization of $64 billion apart from the strategic gains for both players. Joining the two will see the assets and infrastructures of both coming under the same roof.
T-Mobile is currently considered as fourth biggest network service provider in the United States but analysts are predicting that the telco could soon overtake Sprint and occupy the number tree position. Dish Network, on the other hand, operates a vast network of satellite television services across the U.S. and is believed as the second largest player in the industry.
The mutual gains
In terms of solid revenue streams, Dish boasts of 13.8 million satellite TV subscribers and over half a million of internet users. T-Mobile counts more than 57 million of wireless customers and the figures continue to zoom up as The Journal noted that the company lured in significant number of new clients in the first quarter of 2015.
But the real focus of the deal is the likelihood that "a stockpile of airwaves," that Bloomberg valued at around $50 billion, will soon work. The bulk of the licences is due to Dish Network's diligent acquisition efforts over the years.
Deutsche Telekom has yet to comment on the matter. The German telco is majority owner of T-Mobile and has been on the lookout to sell its stakes, Bloomberg said.
