Sprint Leaps on Amended Merger Deal with T-Mobile

Shares of Sprint gain on revised deal with T-Mobile.
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Shares of Sprint S rose in after-hours trading Thursday after the company and T-Mobile  (TMUS) - Get Report announced revised terms of their $26 billion merger agreement which they said could be completed as soon as April 1.

Under the revised deal, T-Mobile parent Deutsche Telekom will hold 43% of the newly created company, while SoftBank, the controlling holder of Sprint, will end up with 24%.

Ordinary shareholders will see no difference in the exchange ratio for their stock – 9.75 Sprint shares for each T-Mobile share.

A federal judge approved the long-delayed deal last week, and a group of state attorneys general doesn’t plan to appeal the ruling. California regulators must still OK the plan.

SoftBank decided to give Deutsche Telekom a larger stake in the combined entity because of declines in Sprint’s financial situation during the two years the deal has been under review, CNBC reported, citing unnamed sources. The agreement allows SoftBank to recover the originally agreed upon stake if the newly combined company meets financial milestones over the next 5 years, according to the report.  

Shares of Sprint rose 48 cents, or 5%, to $9.96 in after-hours trading Thursday. T-Mobile fell $1.25, or 1.26%, to $98.25.