T-Mobile USA, MetroPCS officially tie the knot
T-Mobile USA and MetroPCS officially closed their merger transaction and are now one publicly traded company. T-Mobile started trading today on the New York Stock Exchange under the ticker symbol "TMUS."
On the NYSE, T-Mobile's stock leveled off at around $16.60 per share in its first day of trading.
"The combination of T-Mobile and MetroPCS creates an even stronger disruptive force in the U.S. wireless market," T-Mobile CEO John Legere said in a statement. "Together, as America's Un-carrier, we'll continue our legacy of marketplace innovation by tearing up the old playbook and rewriting the rules of wireless to benefit consumers."
In the new company's first few hours of trading on Wall Street, T-Mobile's stock opened at around $16.30 per share and quickly rose to almost $17 per share before leveling off at around $16.60 per share.
Now that the deal is official, T-Mobile will formally begin the process of integrating MetroPCS into its business. Additionally, T-Mobile will now move to migrate as many customers as possible off of MetroPCS' legacy CDMA network and onto the company's LTE network.
The newly combined company is called T-Mobile US and is based in Bellevue, Wash. The company's board will have 11 members, including two directors of MetroPCS. Timotheus Höttges, currently Deputy CEO and CFO of T-Mobile parent Deutsche Telekom, will serve as chairman of the board. MetroPCS CFO Braxton Carter is now the CFO of the new company and MetroPCS COO Tom Keys will serve as COO of the MetroPCS business.
Under the terms of the transaction, MetroPCS engaged in a reverse-merger with T-Mobile and DT owns 74 percent the combined company. MetroPCS also declared a 1-for-2 reverse stock split and paid $1.5 billion in cash to its shareholders, or $4.06 a share, according to Bloomberg. MetroPCS shareholders will retain 26 percent of the company.
A major impetus for the deal was T-Mobile getting access to MetroPCS spectrum, especially its AWS spectrum. T-Mobile has said the transaction will allow it to deploy 2X20 MHz LTE in 90 percent of the top 25 U.S. markets using MetroPCS' spectrum in 2014 and beyond. The combined T-Mobile and MetroPCS will have 76 MHz of total spectrum in the top 25 major metro areas. The combined company will count 60,000 cell sites and distributed antenna network nodes, resulting in around 765 subscribers per cell site.
T-Mobile also plans to take MetroPCS' flat-rate brand nationwide. The MetroPCS brand will sit alongside T-Mobile's GoSmart Mobile prepaid brand, which T-Mobile launched earlier this year.
T-Mobile ended the first quarter with around 34 million total subscribers and MetroPCS ended the first quarter with 8.99 million total subscribers, giving the combined company around 43 million total customers.
- see this release
- see this T-Mobile investor page
- see this Bloomberg article
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Correction, May 1, 2013: This article incorrectly referred to the new formal name of the company. It is T-Mobile US.