Democratic lawmakers push T-Mobile not to cut jobs after MetroPCS deal closes

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A group of House Democrats urged the FCC to ensure that T-Mobile USA will accept measures to protect jobs as a condition of the FCC's approval of T-Mobile's merger with flat-rate player MetroPCS (NYSE:PCS).

As The Hill notes, in a letter to FCC Chairman Julius Genachowski, 62 House Democrats said they will push back against "another consolidation of two companies that leads to the reduction of American jobs." The two companies hope to achieve $6 billion to $7 billion in post-deal "synergies." The lawmakers wrote that the FCC should force T-Mobile to commit to "preserving U.S. jobs" to get FCC approval.

With any merger of two carriers there are inevitably job cuts as the combined entity reduces headcount because it does not need two separate marketing, sales and back-office departments. Any job cuts that come from a T-Mobile/MetroPCS merger will likely be lower than ones that would have resulted from AT&T's (NYSE:T) proposed $39 billion acquisition of T-Mobile, since that failed deal was of far greater scale.

"The combination of T-Mobile USA and MetroPCS will create a stronger company with the goal of emerging as the country's leading value carrier, providing much needed competition against the larger established players in the wireless business," T-Mobile spokesman Timothy O'Regan said in a statement to The Hill.

Last year as part of a reorganization T-Mobile cut a net 350 jobs. The carrier did slash 900 positions across the company, but also pledged to add would add 550 additional jobs "to support the needs of the business and strategic opportunities." T-Mobile has also been busy expanding its B2B unit, which it said last year would lead to around 1,000 more jobs in the coming years.

MetroPCS has delayed the date of a shareholder vote on the deal from March 28 to April 12. MetroPCS has recently come under pressure from minority shareholders who are pressing for a better deal. Under the terms of the transaction, MetroPCS will engage in a reverse-merger with T-Mobile and T-Mobile patent Deutsche Telekom will own 74 percent the combined company, which will be public. MetroPCS will also declare a 1-for-2 reverse stock split and pay $1.5 billion in cash to its shareholders.

For more:
- see this The Hill article

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