This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

MetroPCS Surges on T-Mobile Merger Speculation

NEW YORK ( TheStreet) - MetroPCS (PCS) shares were climbing Tuesday following a Bloomberg report that the carrier may merge with T-Mobile USA.

Deutsche Telekom, the parent company of T-Mobile USA, is nearing a deal with MetroPCS to create a U.S. operator that would be publicly listed, according to Bloomberg. Citing people with knowledge of the matter, the article said Deutsche Telekom's supervisory board is scheduled to meet in Bonn on Wednesday to approve the deal. Part of the transaction will reportedly involve a stock swap giving the German telecom giant majority ownership of the combined company.

An announcement about the deal could come on Wednesday, Bloomberg said. MetroPCS shares were up 19% at $13.71 on volume of more than 26 million, far eclipsing the issue's trailing three-month daily average churn of 7.1 million.

Bernstein Research analyst Robin Bienenstock described the potential deal as a "shotgun wedding" that would leave rival Sprint (S) at the altar. The analyst nonetheless acknowledged the benefits for MetroPCS and Deutsche Telekom.

"For MetroPCS, depending on price, this appears to represent an elegant exit," he wrote, in a note. "For Deutsche Telekom this is also a positive, while the news is decidedly mixed for Sprint (S). We assume that any deal would leave a listed vehicle in the U.S. where multiples are historically 25% higher than European multiples so leaving some room for error for Deutsche Telekom."

Rumors of a possible MetroPCS/T-Mobile merger have swirled before. Earlier this year, for example, there was chatter about a deal, just months after the Department of Justice blocked T-Mobile's attempted merger with AT&T (T - Get Report).

MetroPCS and Deutsche Telekom have not yet responded to TheStreet's request for comment on this story.

Sprint shares fell 4.46% to $4.95. AT&T was up 0.19% to $37.82, while Verizon (VZ - Get Report) slipped 0.11% to $45.76.

-- Written by James Rogers in New York.

>To submit a news tip, send an email to:

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
PCS $11.84 0.00%
S $3.58 -2.72%
T $38.64 -0.21%
VZ $51.02 -1.30%
AAPL $95.03 -2.90%


Chart of I:DJI
DOW 17,830.76 -210.79 -1.17%
S&P 500 2,075.81 -19.34 -0.92%
NASDAQ 4,805.2910 -57.85 -1.19%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs