Last week, we reported on T-Mobile’s bid for Metro PCS meeting opposition from shareholders. Essentially, Metro PCS shareholders weren’t fond of the deal, as they felt it didn’t represent their best interest. Well, it didn’t represent their best financial interest, at least.
That groundswell of opposition either had more traction than we knew, or T-Mobile is just not in the mood to play around. The Wall Street Journal is reporting that T-Mobile intends to sweeten their offer to buyout Metro PCS. This sweetened deal will likely reduce that $15 billion loan debt the newly formed company would almost immediately assume.
There are no details on just what the terms of a new offer might be, as T-Mobile is unwilling to discuss the matter. It could be a number of things, though. Perhaps the “reverse merger” we told you about previously will be re-structured, though that’s doubtful. In a situation like this, a reverse merger makes the most sense long-term.
Our money is on… money. The current offer made by T-Mobile values Metro PCS shares at about $7-8/share, and it currently trades for quite a bit more than that. A pending merger, with the promise of increased revenue, should only steady or push that price higher. Shareholders want what they feel is a fair price, considering the climate surrounding the deal.
Many are excited for this merger, but unhappy shareholders present problems in the future. This merger, which combines the LTE service of Metro PCS and the un-carrier offerings of T-Mobile, could be a very big deal for US cellular service moving forward. If they can keep an eye on this curve-ball, T-Mobile will have a home run.