MetroPCS Board Backs Deutsche Telekom's Improved Offer


Coverage Type: reporting
Location:
MetroPCS, 2250 Lakeside Blvd, Richardson, TX, 75082, United States

MetroPCS Communications said its board has unanimously approved the amended terms of its proposed merger agreement with Deutsche Telekom AG's T-Mobile USA.

MetroPCS will reduce the combined company debt issued to Deutsche Telekom by $3.8 billion to $11.2 billion, a move the carrier said creates additional financial flexibility and significantly increases the combined company's equity value. Deutsche Telekom has agreed to lower the interest rate on the T-Mobile debt by half a percentage point. The amendment also extends the lock-up period for Deutsche Telekom-owned stock to 18 months from six. A shareholder vote on the proposed merger is scheduled for April 24. Now Deutsche Telekom's strategy is to strengthen T-Mobile through the MetroPCS merger, which would give it new customers and valuable rights to the airwaves. The merged entity's publicly traded stock could give Deutsche Telekom an avenue to sell down its stake in T-Mobile over time.

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