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

Telco M&A May Amazingly Continue After Leap Wireless, AT&T Deal

At this time 24 months ago, AT&T was lobbying with the Department of Justice to win approval of its proposed $39 billion merger with T-Mobile USA (TMUS - Get Report). When that deal was blocked on antitrust grounds, it set off a rapid consolidation of the industry among second-tier players.

T-Mobile acquired MetroPCS in October while, most recently, the industry's third player Sprint (S) was taken over by Japanese telecom SoftBank of Japan. Sprint also recently acquired full control of Clearwire (CLWR).

Friday's merger signals AT&T, the nation's biggest telecom by revenue, believes the DoJ will allow it to be an aggressor in the wireless sector.

Consolidation among industry third and fourth players such as Sprint and T-Mobile may have altered market concentration figures and those surrounding all-important wireless spectrum. Leap Wireless is also a regional service provider, a contrast to T-Mobile, which is the industry's fourth-biggest national player.

The DoJ has expressed an interest in fostering at least three or four nationally competitive wireless providers, meaning Leap may mark the twilight for the telecom sector merger wave.

Sitting in the background of telecom industry consolidation are hedge fund titans who made savvy bets on a merger frenzy.

John Paulson of Paulson & Co. was chief among hedge funds in targeting potential wireless consolidators and has played a crucial role in the industry's realignment. The fund helped to advocate a lowered debt level in MetroPCS's takeover by T-Mobile, and it cast a crucial vote of support on SoftBank's bid for Sprint.

While Paulson may have made billions on stakes in Sprint and MetroPCS after buying both companies' shares when they were priced for failrue, he is also poised to see big profits from a deal for Leap Wireless at $15 a share.

Leap Wireless shares were trading significantly over AT&T's offer price in early Monday trading. Leap shares were rising over 113% to $17.00.

With Clearwire Sprint Moves Onto Final Act of Wireless Drama.

Glenview's Obamacare Bet Matches Paulson's Wireless Windfall.

-- Written by Antoine Gara in New York

2 of 2

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
LEAP $0.00 0.00%
DISH $47.85 -2.20%
S $3.64 4.20%
TMUS $39.68 -0.78%
T $38.80 -0.75%


Chart of I:DJI
DOW 17,762.45 -128.71 -0.72%
S&P 500 2,062.83 -18.60 -0.89%
NASDAQ 4,769.7260 -47.8680 -0.99%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs