Both MetroPCS and T-Mobile have publicly said that they're confident that their proposed merger will reach completion, despite the fact that a few partieshave come out in opposition to the deal. We're now just two days out from MetroPCS's shareholder vote on the deal, which is the last major hurdle that it must clear, and a new report has surfaced that claims that T-Mobile parent company Deutsche Telekom is looking over an improved offer for MetroPCS.
Sources speaking to The Wall Street Journal say that Deutsche Telekom is currently reviewing a new bid for MetroPCS that includes better terms than the original offer made by DT. As the deal stands now, MetroPCS shareholders would receive around $1.5 billion in cash and be given a 26 percent stake in the combined T-Metro. There's no word yet on what Deutsche Telekom's improved bid would entail, but one WSJ tipster claims that Deutsche Telekom is likely to make its better offer official and that the company could announce it as soon as today.
So far we've seen a few different entities come out against the proposed merger of T-Mobile and MetroPCS, including one stockholder advisory firm as well as hedge fund Paulson & Co., which is MetroPCS's largest shareholder. The latter company claims that the current deal is unfair to shareholders and that, if approved, it would result in a combined T-Metro that has too much debt at too high an interest rate to be able to effectively compete in the U.S. wireless market. As it stands, the combined company would be taking on over $20 billion in debt.
Deutsche Telekom has previously said that its current offer for MetroPCS is good enough, but by the sound of this rumor, DT may be starting to sweat a bit as we head into the final hours before MetroPCS's shareholder vote. If Deutsche Telekom does opt to improve its offer for MetroPCS, we'll give you a shout.