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T-Mobile USA set to close acquisition of MetroPCS
Wednesday - 5/1/2013, 9:10am EDT
AP Technology Writer
NEW YORK (AP) -- T-Mobile USA, the country's fourth-largest cellphone carrier, is set to complete its acquisition of MetroPCS after the stock market closes on Tuesday.
T-Mobile is adding 9 million MetroPCS customers to its own 34 million. The combined company will stall lag No. 3 Sprint Nextel Corp. in size.
No immediate changes are expected for customers of either company. However, T-Mobile plans to shut down MetroPCS's network over two years, which means MetroPCS phones will eventually stop working. T-Mobile will use the space freed up on the airwaves to boost its own coverage and data speeds.
T-Mobile, a subsidiary of Germany's Deutsche Telekom AG, will gain its own U.S. stock listing by merging with Dallas-based MetroPCS Communications Inc., which is listed on the New York Stock Exchange. The new ticker symbol will be "TMUS."
With the closing, MetroPCS shareholders are getting $4.08 per share in cash, or $1.5 billion in aggregate. They're also getting half a share of the new company for each MetroPCS share, resulting in a 26 percent ownership stake. The rest will be owned by Deutsche Telekom.
MetroPCS shares fell 20 cents, or 1.7 percent, to $11.74 in afternoon trading Tuesday. That puts the value of TMUS shares at about $15.30 each, and the market capitalization of the new company at $17 billion.
MetroPCS's board agreed to sell to T-Mobile in October, but shareholders and shareholder advisory firms called the offer inadequate. T-Mobile improved its bid three weeks ago by reducing the amount of debt it would transfer to the new company and reducing the interest rate on the debt. The improved offer won shareholder approval last week.
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