By 
The merger between Deutsche Telekom’s T-Mobile and MetroPCS has seen better days. Things were a lot more exciting for both parties when the deal was first announced, but after shareholders had time to analyze the deal many are reported to be a bit hesitant about voting to approve it. Most of the hesitance has come from the pile of debt — $15 to $20 billion worth — DT wants to roll into the new company, a move that would significantly weaken the value of shareholders’ equity.
With voting set to take place this month and with both sides unsure of what might happen, Deutsche Telekom is apparently thinking about sweetening the deal. The Wall Street Journal reports as much, saying a new deal could be on the table as early as today.
It wouldn’t be a huge detour from the original, but it’s believed the main goal will be to loosen the burden of debt that would cause the value of the shareholders’ equity to deflate. If that is the sole issue keeping those on the fence from hopping over to greener pastures then the two sides should have nothing to worry about once the next shareholders’ meeting takes place this Friday.
Nothing else would stand in the way of this deal being approved, of course, as all the regulatory bodies and government agencies looking into it have given their blessings to let it go through. If the reported dissension in the ranks over at MetroPCS can be alleviated by whatever new deal Deutsche Telekom will announce soon then T-Mobile will be in good shape to do whatever it needs to compete with the rest of the big dogs for 2013 and beyond.
Dear MetroPCS shareholders,
Big picture. BIIIG PICTURE, people. See it.
I personally want the merger to occur. Heck, a lot of econ is about acquisitions and mergers. People don’t want an oligopoly to occur in the mobile market. I think that T-Mobile will get Metro on board soon. The shareholders are just trying to get the most money possible at the end of the day I guess? We will see what happens.
I find it shady that the deal can be changed after going through all the necessary regulatory approvals. Can the deal be altered without the need to be approved again?
Happens all the time, especially in Congress. One house passes a bill, the other alters it, passes it, and then a subcommittee of the two houses reconciles it to send it to the president. In this case, as long as the basic tenets of the merger are left unchecked, the regulatory commission cares not. This sounds like it is purely financial for the shareholders, who have yet to approve the merge.
Most regulatory approvals check to see if it will be bad for consumers, bad for the workforce, etc. Altering the amount of money you are paying, especially increasing it, is irrelevant.