Sprint, T-Mobile merger called off as SoftBank withdraws: Report

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Softbank calling off talks to merge Sprint, T-Mobile: Report

FBN's Charlie Gasparino on a report that Softbank is calling off talks to merge Sprint and T-Mobile.

Sprint (S) and T-Mobile (TMUS) shares are plunging Monday amid a report that SoftBank Group, Sprint’s parent company, is nixing a proposed merger between the two telecommunications giants.

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The deal purportedly fell apart after SoftBank and Deutsche Telekom, T-Mobile’s owner, failed to agree on terms of ownership for the company post-merger. Deutsche Telekom had pushed for a controlling stake, Nikkei news service reported, citing a source familiar with the situation.

T-Mobile’s stock fell more than 5% in trading on Monday. Sprint shares plunged more than 7%. SoftBank officials could approach Deutsche Telekom to formally end negotiations as early as Tuesday, according to Nikkei’s report.

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Reports of a potential merger between the two companies first emerged in September. Under initially-discussed terms, Deutsche Telekom was set to be the majority owner in a stock-for-stock deal. At the time, SoftBank CEO Masayoshi Son had reportedly mandated that he have a say in how the company proceeded if the merger succeeded, though T-Mobile CEO John Legere was projected to lead the combined companies.

Had it succeeded, the merger would have positioned the two companies to better challenge telecom leaders Verizon (VZ) and AT&T (T) in the competitive industry.

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