Sprint, T-Mobile to give Deutsche Telekom slightly higher stake after merger

Sprint, T-Mobile to give Deutsche Telekom slightly higher stake after merger

T-Mobile CEO John Legere (L) and Sprint CEO Marcelo Claure pose for pictures on the floor of the New York Stock Exchange April 30, 2018.

Brendan McDermid | Reuters

Sprint and T-Mobile have agreed to amend their merger deal agreement to give Deutsche Telekom a slightly higher ownership stake in the new combined company, according to people familiar with the matter.

Common shareholders won’t see a change in the exchange ratio, which is 9.75 Sprint shares for 1 T-Mobile share, said the people, who asked not to be named because the discussions are private. An announcement is expected later Thursday, the people said.

Deutsche Telekom, the majority owner of T-Mobile, and SoftBank, which owns more than 80 percent of Sprint, didn’t want to amend the common shareholder exchange ratio because a change would require a new shareholder vote which would add months to the deal’s closing. The two companies have already waited nearly two years for the transaction’s approval after state attorneys general sued to block the deal.

SoftBank agreed to give Deutsche Telekom a slightly higher ownership stake after Sprint’s financials have eroded during the long deal approval process.

A U.S. district judge ruled in favor of the $26 billion merger between Sprint and T-Mobile last week. New York Attorney General Letitia James, who helped lead a lawsuit from a group of state attorneys general against the merger, said on Sunday she would no appeal the decision. The merger still can’t close until the California Public Utilities Commission approves the transaction.

Spokespeople for Sprint and T-Mobile declined to comment.

This story is developing.

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