Wednesday, May 01, 2013, 07:45 am PT (10:45 am ET)
T-Mobile, MetroPCS officially merge, bringing iPhone to 9M more in USDeutsche Telekom and T-Mobile announced on Wednesday the completion of T-Mobile USA's merger with MetroPCS Communications, creating an entity with roughly 43 million subscribers across the United States and making Apple's iPhone available to an additional 9 million customers.
The last obstacles to creating the new entity known as T-Mobile US and trading on the New York Stock Exchange under the symbol TMUS were cleared in late April, when MetroPCS' shareholders approved the merger following an improved offer from Deutsche Telekom. The deal saw MetroPCS effecting a 1 for 2 reverse stock split and paying its shareholders $1.5 billion, or roughly $4.05 per share.
T-Mobile is the fourth-largest carrier in the United States, with the 9 million added subscribers from MetroPCS bringing its total base to about 43 million. Based on 2012 financial reporting, the company has about $24.8 billion in revenues and $2.7 billion in free cash flow.
T-Mobile's president and CEO, John Legere, will head the new company, while MetroPCS' vice chairman and CFO, J. Braxton Carter, will serve as CFO.
The combined company will, for a time, operate under separate brands, with MetroPCS customers gradually being migrated into T-Mobile's network. During that transition, MetroPCS' CDMA network spectrum will be repurposed for T-Mobile's LTE network. The process is expected to be completed by 2015.
The deal marks the completion of a months-long process that saw MetroPCS' board of directors approving the merger in October. In the time since then, T-Mobile has significantly modified its pricing structure, adopting an "UNcarrier" brand with a no-contract standard and adding Apple's iPhone to its handset offerings.
Prior to officially adding Apple's iPhone, T-Mobile had been successfully attracting owners of unlocked iPhones to its network at a rate of roughly 100,000 per month. While those customers were limited to much lower data speeds, T-Mobile had brought in about two million by the time the iPhone officially debuted on its network. Prior to the merger, MetroPCS customers did not have access to the iPhone.
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