Dish Network (NASDAQ: DISH) Chairman Charlie Ergen has told T-Mobile US (NYSE:TMUS) parent Deutsche Telekom he is interested in a future deal for the carrier, according to a Bloomberg report. Ergen previously left the door open for a bid for T-Mobile after merger talks between T-Mobile and Sprint (NYSE: S) broke down last month.
The report, citing unnamed sources familiar with the matter, said Ergen has not made a formal offer but said that he would be open to the idea of making one in the next few months. The report said Ergen will wait until after the conclusion of the FCC's AWS-3 spectrum auction, which starts Nov. 13, before making any concrete moves toward T-Mobile. Anti-collusion rules for the auction kick into effect this month. Both T-Mobile and Dish are expected to participate in the auction.
Dish hasn't formally hired a bank to advise it on a T-Mobile bid, the report said, and it's unclear how serious Dish is. Ergen has consistently maintained that he and Dish have "optionality" when it comes to wireless, and he has reportedly had on-and-off talks with DT for several years.
Ergen is seeking to partner with a wireless carrier with existing network infrastructure to defray the costs of launching a network. Dish holds a trove of spectrum but has not started building out a network to support it, and Ergen has consistently said he would like to work with a wireless carrier to deliver mobile video.
T-Mobile and Dish declined to comment, and the reported added that DT said it is under no pressure to sell T-Mobile.
T-Mobile recently acknowledged that French mobile and Internet company Iliad is still interested in pursuing a deal for T-Mobile. Iliad CFO Thomas Reynaud said the company may make an improved offer by working with unnamed partners. Iliad in late July made a $15 billion bid for 56.6 percent of T-Mobile, valuing the carrier at $33 per share. DT rejected that offer as too low.
Ergen's most recent efforts at wooing T-Mobile have been in part motivated by his desire to persuade Deutsche Telekom not to reach a deal with Iliad before the end of the year, the report said.
Ergen reiterated last month that it is "relatively unlikely" that Dish will try to build out its spectrum by itself or just sell its spectrum. He said it would be a "personal failure" if Dish failed to get into the mobile market, but that if Dish could not do so "we wouldn't be hesitant at that point" to sell the company's spectrum.
Ergen said Dish's "dream" remains to get into the wireless industry, "compete in the marketplace, bring a better product to consumers, be disruptive, be innovative and enhance the video business that we have today."
- see this Bloomberg article
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