T-Mobile is considering cutting prices to buy Sprint, according to sources familiar with the matter. The U.S. Department of Justice announced earlier this year that it had reached an agreement on a merger of more than $26 billion for the two communications companies. Shares in both companies hit record highs after T-Mobile and Sprint announced their merger this summer, with Sprint’s shares rising to $8.06 at one point.
But since then, Sprint’s share price has fallen below $6 as investors have come to believe that T-Mobile will eventually have to lower its initial offer.
Under the deal with the U.S. Department of Justice, Dish will pay $5 billion for Sprint’s portfolio, which includes Mobile, Virgin Mobile and other prepaid handset businesses. In turn, T-Mobile will provide at least 20,000 cellular towers and hundreds of retail stores. In addition, Dish has access to the T-Mobile network for seven years.
But the two companies must first settle a lawsuit led by the new State and California attorneys general before completing the deal. Trial proceedings in the case are scheduled to begin next Monday.