Reports of T-Mobile merging with Sprint have been a dime a dozen over the past few months. A recent report suggested that T-Mobile’s parent company had in principle agreed to a merger with Sprint for $32 billion though an official bid is yet to be submitted. Its a possibility that instead of Sprint CEO Dan Hesse, T-Mobile’s John Legere will be tapped to stay on as CEO of the merged entity.
Anyone who follows industry news will now the kind of reputation Legere has cultivated for himself. He’s blunt, doesn’t shy away from ridiculing competitors on Twitter and has even crashed a party thrown by its rival only to be escorted out by security. But under him Magenta has rapidly increased its subscriber base and has put the pressure on behemoths like AT&T and Verizon, so its no wonder that he may be tasked with leaving the post-merger company forward.
It is believed that these days negotiators from both sides are fine tuning certain points of the deal. There’s still the issue of regulatory approval though. Multiple reports suggest that federal regulators aren’t exactly a fan of this idea, in 2011 they shot down AT&T’s bid to acquire T-Mobile, so a concern exists in some circles that this might happen once again.
New Street Research analyst Jonathan Chaplin tells Bloomberg that if Legere is in charge, they can “really take it to Verizon and AT&T.” He also says that after the merger Legere will be “twice as crazy” as he’ll have double the asset base to work with.
Even with Sprint and T-Mobile combined their subscriber base nearly equals that of AT&T, but an argument can be made that at least the merged entity will be in a much better position to compete against both Verizon and AT&T. If Legere on T-Mobile’s helm irked its rivals, then they might have a few sleepless nights when he becomes twice as powerful.