T-Mobile US is reported to be in talks again with cable giant Dish Network over a merger which could prove to be the largest ever tie-up between the television and communications industries.
According to reports from the Wall Street Journal, the two sides are almost in agreement over the make-up of the combined company, with Dish CEO Charlie Ergen becoming the combined entity’s chairman and outspoken T-Mobile CEO John Legere serving as CEO.
There are still several things needed to be panned out between Dish and T-Mobile, including the purchase price and how much stock will be included in the deal.
If it goes through, the deal value will be large given T-Mobile’s market capitalisation of $31 billion and Dish’s $33 billion.
Last September it was reported that Dish had contacted Deutsche Telekom to express interest about acquiring the German group’s T-Mobile US subsidiary. Those rumours soon died.
While both sides have made no official comment on the new rumours, Legere has taken to Twitter to respond to an article published by technology publication Re/Code, which suggests the merger could be more out of convenience, given that both have failed to partner with other companies.
Legere tweeted: “Snarky sensational and shallow look at a rumour that deserve no comment.”
Both sides have seen deals to merge with Sprint fall through in recent years, and analysts will argue that both companies need to merge to compete better in their respective markets.
T-Mobile US, the country’s fourth largest carrier, has made strides in adding to its subscriber base in recent quarters since Legere was appointed in 2012, but it still trails significantly behind AT&T and Verizon in the mobile space. It is thought that a merger with Dish will help the company add to its network capacity through the cable player’s wireless licences.
The rumoured deal follows a wave of consolidation in the cable sector, with rivals AT&T now close to completing a tie-up with Dish’s rival DirecTV, while Charter Communications is also going through the motions to consolidate with Time Warner Cable and Bright House Networks, which would create the second largest US cable company.