Mergers

Sprint's 'Severe Financial Distress' by Neil Savage

What's the best reason to get married? For money and a secure future, right? 

Sprint has improved in many respects over the last year, from ditching those annoying family plan commercials to increasing their coverage. Regardless, they're now fourth in the market and looking at a 52-week low stock.

In the midst of success, potentially crippling failure. 

Sprint's setback could be the key to getting a Sprint/T-Mobile merger off the ground, though, as RCR Wireless reports. The two giants tried to merge in 2014, but regulatory killed the deal. Maybe with a puttering stock, the deal will be viewed more positively. It definitely will be successful if they hire Kevin Durant to represent them.

Merger a-Comin' by Neil Savage

You heard it here first... or second... or third. Whatever number it ends up being. Inside Tower reports that the Wall Street Journal reports that Dish Network and T-Mobile are cuddling up nice and cozy-like. That's not really news, at this point, though. Well, some more details have surfaced: Dish Chief Executive Charlie Ergen would be the new company's (T-Network? Dish Mobile?) chairman and T-Mobile's John Legere would be CEO. Inside Towers also brings us some opinions on how the landscape could change because of the merger:

"Jonathan Schildkraut at Evercore ISI: “We see a number of potential strategic benefits from the proposed combination: (1) significant spectrum resources (T-Mobile has roughly 84MHz of spectrum and Dish has roughly 81MHz with both having concentrations in the AWS and PCS bands plus a little 700MHz); (2) ability to deliver wireless broadband to rural markets (markets to which Dish customers are over-indexed); (3) add significant spectral capacity to TMUS’s network in urban and more densely populated sub-urban markets; and (4) a strong cultural fit (based on market disruption and addressing customer pain points)… Dish generates a fair amount of FCF [free cash flow] on its core business, while T-Mobile is expected to inflect to FCF positive in 2015. The combination of growing cash flows would allow for more aggressive network investment – particularly in markets where T-Mobile may need additional scale (i.e., more rural markets)."

Verizon Communications Buying AOL for $4.4B by Neil Savage

You've got a buyer...

RCR Wireless brings us news of Verizon purchasing former juggernaut AOL. We hear it's just to own their stable of CDs containing hundreds of hours of free internet access. From RCR:

"Verizon Communications is diving deeper into digital content with an agreement to buy AOL for $50/share, or approximately $4.4 billion. The nation’s leading wireless carrier said that AOL will boost its LTE wireless video business, its “over-the-top” video offerings and will create “a growth platform from wireless to IoT for consumers and businesses.”

While AOL is not well-known for wireless video, it has invested in a digital advertising platform. The company also owns valuable content brands, including Huffington Post, Engadget, TechCrunch and Makers.

For Verizon, this is the latest in a string of acquisitions aimed at beefing up its digital media business. Last year the carrier bought Intel Media for Internet video technology, content delivery network EdgeCast Networks, and live video encoder UpLynk.

Check out the rest of the article here."