T-Mobile US Inc (NYSE:TMUS) and DISH Network Corp (NASDAQ:DISH) are holding discussions to decide on a deal that could lead to the formation of a merger between the two firms.
Word from a source affiliated to the undertaking revealed that the Dish and T-Mobile might have plans to form a giant conglomerate. Dish is the second largest satellite TV Company while T-Mobile is ranked fourth among the mobile operators in the United States.
Upon the knowledge of the news, the share listings for Dish and T-Mobile rose by 5.6% and 4.8% respectfully during the morning trading. Deutsche Telekom, T-Mobile’s majority shareholder also experienced a 2.9% spike in its share performance.
There have been rumors about a possible merger between the two companies for some time. Some of the executives from the two firms have also hinted such dealings in the company’s past during their public meetings. Deutsche is also looking forward to partnerships between the two firms because it would strengthen its operations in the U.S.
A merger between Dish and T-Mobile would be advantageous because it would create more value generating services, especially for their clients. The discussions between the two firms are in their initial stages and where vital elements of the merger have to be considered. The companies are yet to discuss the price and structure of the conglomerate, according to sources seeking for non-disclosure of their identity.
Dish and T-Mobile US Inc (NYSE:TMUS) have not yet replied to emails seeking more about the matter. One of the Spokespersons from Deutsche refused to comment on the issue when he was approached. Ithas however been revealed that T-Mobile’s CEO, John Legere will be the CEO of the conglomerate. Charlie Ergen, who serves as the current CEO of Dish, will act as the new Chairman.
DISH Network Corp (NASDAQ:DISH) is currently worth about $33 billion while T-Mobile is worth around $31 billion. Deutsche owns 66% stake in T-Mobile. Both companies are looking to capitalize on the new deal.