T-Mobile and Sprint have finally agreed to a $26.5 billion deal that will make T-Mobile the third-largest carrier in the United States, the companies announced Sunday.
T-Mobile CEO John Legere will be CEO of the new company, which will continue under the T-Mobile name.
The agreement comes after two previous failed attempts to merge the two carriers. The most recent was in November of last year, when talks between the two companies fell apart amid reported disagreements over Sprint’s valuation and SoftBank’s reluctance to cede control of Sprint.
So what changed in the last five months? Well, T-Mobile parent company Deutsche Telekom and Sprint parent SoftBank reached an agreement that valued Sprint at $26.5 billion for one. Sprint Chairman and Softbank CEO Masayoshi Son will also serve on the board of the new T-Mobile, Bloomberg reported.
But, a more important driver may have actually been something else entirely: 5G. As Verizon and AT&T move closer and closer to rolling out their 5G networks, Sprint and T-Mobile are under increasing pressure to deliver their own 5G service.
The two companies say they have a much better shot at taking on Verizon and AT&T together than they do alone.
“The New @TMobile will be the ONLY company able to bring a broad & deep nationwide 5G network – something no US wireless company could achieve alone in the critical early years of 5G.,” Legere wrote on Twitter.
💝By bringing the first and best 5G network to market, we’re accelerating the innovation it allows – disrupting industries & creating sustainable competition. THAT means ⬇️ prices for consumers, new US businesses & tons of jobs created! More: https://t.co/Hg3oxTZljJ
— John Legere (@JohnLegere) April 29, 2018
Though both companies have signed onto the deal, the merger is likely to still face at least some regulatory scrutiny from Washington.
But if Legere has any concerns about regulatory approval, it wasn’t apparent in his tweets following the announcement.
“With @Sprint’s incredible 2.5 GHz spectrum, @TMobile’s nationwide 600 MHz + our other combined assets… Together, we will build the highest-capacity mobile network in US history!! I’m talking 30X more capacity than T-Mobile today!!”
Legere wasn’t always full of praise for Sprint, though. After the first attempted merger broke down in 2014, the notoriously outspoken CEO took to Twitter with some sick burns aimed at Sprint and its CEO, Marcelo Claure.