Dish Network Corp. is currently setting down details of future merging with T-Mobile US Inc., people close to the matter said. The deal is predicted to accelerate a wave of consolidation across the U.S. media and communications industries.
Both companies are in close agreement about what the combined body would look like. Dish Chief Executive Charlie Ergen will become thechairman and his T-Mobile counterpart, John Legere, will perform responsibilies of CEO, the sources claim.
“Tougher questions about a purchase price and the mix of cash and stock that would be used to pay for a deal remain unresolved, the people said. One of the people characterized the talks as at “the formative stage,” and said an agreement might not ultimately be hammered out,” The Wall Street Journal writes.
“If completed, the deal would be the latest multibillion-dollar combination in traditional television and communications industries being upended by the Internet. T-Mobile rival AT&T Inc. is close to wrapping up its $49 billion deal for Dish rival DirecTV that will create the country’s largest pay-TV company. Meanwhile, Charter Communications Inc. recently announced a total of $67 billion in deals that would roll up Time Warner Cableand Bright House Networks to create the second-largest U.S. cable operator,” the publication adds.
Experts are sure that the upcoming deal will be quite a significant one as T-Mobile has a market capitalization of about $31 billion, a little below Dish’s $33 billion.
By the way, one of the most outstanding “wireless” deal was completed two years ago when Verizon Communications Inc. agreed to pay $130 billion to buy Vodafone Group’s 45% stake in Verizon Wireless and take full control of the nation’s top wireless carrier. The deal was announced by Vodafone after the close of trading on the London Stock Exchange.
The two firms said Vodafone would get $58.9 billion in cash, $60.2 billion in Verizon stock, and an additional $11 billion from smaller transactions that would take the total deal value to $130 billion.
The British group will return 71 percent of the net proceeds to shareholders. All the stock will go to shareholders, plus $23.9 billion in cash, after the deal is finalized, likely to be in the first quarter of 2014.
“This is great news for Verizon on many fronts,” said Jeff Kagan, an independent technology industry analyst. “One of which is the world is rapidly moving toward wireless, and there are still enormous opportunties for growth going forward.”
“It’s the best-run wireless operator in the U.S., and by some measures maybe the best-run wireless operator in the world,” Craig Moffett, an analyst at Moffett Research LLC, said on Bloomberg Television before the agreement was announced.
Verizon has been trying for more than a decade to win back control of its wireless business — the most profitable in the United States.
Chief Executive Lowell McAdam and Verizon Chief Financial Officer Francis Shammo spent time discussing the deal with Verizon’s largest shareholders, Mr. McAdam said.