Business / Corporate

SoftBank expects final bid for Sprint-T-Mobile merger this week as prospects for deal fade fast

Bloomberg

SoftBank Group Corp. is waiting to hear back from Deutsche Telekom AG on an 11th-hour bid to save a merger between Sprint Corp. and T-Mobile U.S. Inc. as the chances for a deal dwindle fast, according to people familiar with the matter.

The company is expecting Deutsche Telekom to make a final proposal this week that will include how many Sprint shares it’s willing to accept for each T-Mobile share, said the people, who asked not to be identified as the detail aren’t public.

SoftBank, led by Chairman Masayoshi Son, has signaled it is holding out for an exchange ratio of less than eight Sprint shares per T-Mobile share, they said. The current exchange ratio, based on Tuesday’s trading, is more than nine.

Even if Deutsche Telekom offers an appealing exchange ratio, Son has reservations about relinquishing control of Sprint, given his desire to dominate a future internet-connected world, one of the people said. SoftBank has been negotiating how to keep Son as a decision-maker for the combined company, including naming the billionaire as co-chairman, the person said.

A spokeswoman for Sprint declined to comment. Representatives for Deutsche Telekom, SoftBank and T-Mobile didn’t immediately respond to requests for comment.

Talks hit a serious snag in the past few days as the companies clashed over details from valuation to control of Sprint’s U.S. wireless business, people familiar with the matter said Monday. While merger talks have been underway for months, SoftBank board members have raised concerns in the past few days because it’s now a make-or-break moment with the sides very close to a deal, the people said.