T-Mobile, MetroPCS Merger Given FCC Green Light

MetroPCS and TMobile

T-Mobile and MetroPCS can move forward with merger plans following approval from the Federal Communications Commission (FCC). According to the FCC, the merger between T-Mobile parent company Duetsche Telekom and regional carrier MetroPCS will allow for faster LTE deployment while expanding MetroPCS into new markets.

MetroPCS is the nations fifth-largest wireless provider with 9.3 million customers. T-Mobile is the fourth largest carrier in the United States with 33.2 million customers.

The FCC was able to approve further movement on the merger front after the Department of Justice allowed the standard 30-day antitrust waiting period to lapse.

Shareholders must still approve the deal, which includes cash payouts of $1.5 billion and a 26 percent share in the merged company.

Already planning to vote against the merger are shareholders P. Schoenfeld Asset Management and Paulson and Company. Those major shareholders believe the two combined companies will hold too much debt when merged. Together, the major shareholders combine for a 20 percent share in the company.

“With today’s approval, America’s mobile market continues to strengthen, moving toward robust competition and revitalized competitors. Today’s action will benefit millions of American consumers and help the U.S maintain the global leadership in mobile it has regained in recent years,” said FCC Julian Genachowski.

MetroPCS and T-Mobile USA customers will remain on their own respective networks for the time being. T-Mobile and MetroPCS operate on different mobile technologies, which makes it impossible to convert their respective customer bases in any quick fashion.

Both T-Mobile and MetroPCS are rolling out 4G LTE networks, which are expected to play nice with one another. In the future, the company will shift users to a singular network where they will benefit from a larger nationwide footing in the cellular market.

Do you think the T-Mobile and MetroPCS merger can help create more competition in a space dominated by AT&T Wireless and Verizon Wireless?