Sprint and T-Mobile are close to merging. The terms of the deal as currently reported has Sprint paying $40 per share for T-Mobile, which values T-Mobile at approximately $32 billion. Both of the companies have had a hard time competing with Verizon and AT&T in the U.S. cellular phone business. Sprint has lost money in its last 7 quarters and while T-Mobile has gained some steam with its “no contract” plans, it is still a distant player compared to the big two.

A few years ago, AT&T tried buying T-Mobile. Terms were set and both sides agreed but the U.S. Department of Justice closed down the deal, stating that it would hinder competition. This deal, should it go forward, has a better chance of being completed as it combines the third- and fourth-largest carriers. For more information, visit this Wall Street Journal article.

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Joe Lan
ABOUT THE AUTHOR:

Joe Lan is a financial analyst for AAII. Joe is a graduate of Northeastern Illinois University, where he earned a bachelor's degree with a double major in accounting and finance and holds a master's degree in accounting and financial management from the Keller Graduate School of Management. Joe writes extensively for Computerized Investing and is a frequent contributor to the AAII Journal. Joe also sits on the advisory committees for the Stock Superstars Report and Dividend Investing newsletters. Lan is a holder of the right to use the Chartered Financial Analyst (CFA) designation.

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