Just after the five month mark since T-Mobile’s purchase of MetroPCS was announced, regulators have signed off on the transaction. Yesterday, it was the FCC giving the green light, and today the FTC has followed suit. But regulatory clearance hasn’t really been the question, now T-Mobile and MetroPCS will face the real test: the smaller carrier’s shareholders.
The vote has been moved up to April 12, and yesterday, MetroPCS sent out a letter to those shareholders making the case for approving the deal. But some of the biggest shareholders have already indicated that they plan to vote against the deal citing concerns over valuation and debt. In other words, they’re looking for a better deal from Deutsche Telekom and they think they have the leverage to make it happen given the paucity of alternatives.
It’s interesting that both the Sprint/Clearwire deal and the T-Mobile/MetroPCS deal are facing this much blowback. Both acquirees aren’t really in a position to not do a deal, but their shareholders feel that the acquirers are in even less of a position to let things fall through. High stakes spectrum poker is going on here, all we can do is wait to see who gets called and who isn’t bluffing (or shouldn’t be).
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