Dish in talks with banks for funding T-Mobile acquisition
15 Jun 2015
Dish Network Corp had been meeting with various financing institutions in a bid to secure between $10 billion and $15 billion to increase the cash portion of its acquisition bid for telecommunications carrier T-Mobile US.
According to techtimes.com, which cited unnamed sources familiar with the matter, the balance of the potential business deal would be settled using Dish Network shares.
Deutsche Telekom AG, owner of 66 per cent of the company US company's shares, would be left with a large minority stake, in the event the deal was closed.
Currently Dish had a market capitalisation of around $34 billion while T-Mobile US had a market value of approximately $31 billion.
The two firms had reportedly been in talks over a possible merger of the second-largest US satellite TV operator and the fourth-largest carrier in the country.
While the terms of the merger had not been revealed for confidentiality purposes, no agreement had yet been finalised, Dish's search for financing meant the merger talks were making headway, commentators said.
Dish had acquired an extensive portfolio of spectrum, the most important component of wireless networks, which carry the growing amount of data flowing through mobile devices.
The company acquired $13.3-billion worth of wireless spectrum in a US auction early this year, without building any infrastructure to put the spectrum to extensive use.
Meanwhile, the online edition of Headlines & Global News quoted Sergy Dluzhevsiiy, a Rye New York-based analyst at Gabelli & Co as telling Bloomberg that, T- Mobile had outperformed their expectations.
He added, they were going to be looking for the best possible deal. Charlie Ergen was a tough negotiator, and obviously Deutsche Telekom was not a forced seller, he added.
Ergen was fully aware that getting T-Mobile from Deutsche Telekom would not be easy work and the merger would require the approval of its German parent, which owned 66 per cent of T-Mobile.
