MetroPCS Advised To Not Merge With T-Mobile
T-Mobile has recently proposed to merge with MetroPCS, and now many are advising for shareholders of MetroPCS to vote against this merger. An adviser; Glass Lewis claims that MetroPCS is not given enough for their deal, and that they would be better off on their own and competing in the highly competitive industry. The deal for the merger was to give shareholders $4 for each share that they hold, and give them 26% of the company after they have combined. The shareholders are not all leaning towards one direction, so it is possible for this merger to be shut down.
The wireless telephone industry is a competitive industry especially with the top four service providers having such a large impact on the industry it is difficult for smaller companies to even make a dent. There have been previous talks of an acquisition of T-Mobile by AT&T, but that acquisition did not go through in order to keep this industry competitive and prevent any service provider from gaining a monopoly. MetroPCS is better off not merging with T-Mobile because they have a large potential to grow into a larger company, and ultimately benefitting consumers.
Written by: Jessica Ho
Source: The Wall Street Journal
Troianovski, Anton. (2013).Adviser Urges MetroPCS Holders to Reject T-Mobile Deal. The Wall Street Journal. Retrieved From: http://online.wsj.com/article/SB10001424127887324685104578390131248364560.html?mod=WSJ_business_whatsNews