MetroPCS' (NYSE:PCS) shares rose today after a financial analyst said that Sprint Nextel (NYSE:S) may make a counter-bid for the prepaid carrier to compete with the bid from Deutsche Telekom's T-Mobile USA.
MetroPCS' share jumped 5.6 percent after Guggenheim Securities analyst Shing Yin wrote in a research note that Sprint could make a bid of $12 to $13 per share for MetroPCS within the next four weeks. Yin said that Sprint extended its deadline on Thursday for a proxy statement related to Softbank's proposed $20.1 billion investment in Sprint, which will give Softbank a 70 percent stake in Sprint. Yin said that extension supports the theory that Sprint is preparing a counter-offer,
Under the T-Mobile deal, Deutsche Telekom will hold 74 percent of the merged business, which will be a publicly traded company, and will pay MetroPCS shareholders $1.5 billion in cash. DT and MetroPCS expect the deal to close by mid-2013.
The speculation comes a few weeks after MetroPCS released its own proxy statement on the events leading up to the T-Mobile deal. MetroPCS was courted by a number of wireless firms, including Dish Network and Sprint, prior to agreeing to the deal with T-Mobile.
MetroPCS' 500-plus-page proxy statement said that MetroPCS came close to being acquired by a wireless carrier (and a MetroPCS roaming partner), referred to as "Company G" in late February but that company's board refused to approve the deal. According to a Bloomberg report, which cited unnamed people familiar with the matter, Sprint was "Company G." Bloomberg reported that Sprint later considered making a counter-bid to the T-Mobile offer. In fact, Walt Piecyk of BTIG Research told Bloomberg that Sprint would likely study MetroPCS' proxy statement to see whether it should still launch a competitive bid.
- see this Bloomberg article
MetroPCS courted by Sprint, Dish and others prior to T-Mobile deal
MetroPCS says T-Mobile deal will allow it to expand its brand nationwide
T-Mobile, MetroPCS ask FCC for deal approval
DT expects T-Mobile/MetroPCS deal to close in Q2
Report: Sprint board nixes MetroPCS acquisition at the last minute