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T-Mobile purchases Suncom for 2.4 Billion

Discussion in 'GENERAL Wireless Discussion' started by firstmode, Sep 17, 2007.

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  1. firstmode

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    T-Mobile USA to buy SunCom for $2.4B


    By Kelly Hill

    Story posted: September 17, 2007 - 11:50 am EDT


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    T-Mobile USA Inc. announced it will acquire regional operator SunCom Wireless Holdings Inc. for about $2.4 billion in cash and assumed debt.

    SunCom's GSM/GPRS/EDGE network covers parts of the southeastern U.S. and the Caribbean; the carrier has provided roaming in its markets to T-Mobile USA since 2004, according to the national carrier. SunCom has markets and customers in the Carolinas, Tennessee, Georgia, Puerto Rico and the U.S. Virgin Islands.

    "The strategic fit of the SunCom operations will make this a near-perfect acquisition," said Robert Dotson, president and CEO of T-Mobile USA. "It will round out our domestic footprint, allowing us to serve 98 of the top 100 markets, and will significantly benefit our financial position by reducing roaming expenses."

    T-Mobile USA expects the acquisition to boost its covered potential customers from 244 million to 259 million. The carrier also said that it expects synergies of about $1 billion due to reduced roaming costs and operating expenses. SunCom had 1.1 million customers at the end of the second quarter of 2007, more than 95% of whom were postpaid customers.

    T-Mobile USA indicated that investment funds owning more than 50% of SunCom's issued common stock have already agreed to vote in favor of the acquisition. The transaction is expected to close in the first half of next year.

    Rene Obermann, chairman of T-Mobile USA parent company Deutsche Telekom AG, said that the acquisition fits within the company's overall strategy to "grow abroad with mobile" while reducing costs and expanding market presence.

    "As a result, this acquisition will fit very well with our strategy to grow abroad with mobile primarily within our current footprint within the context of market consolidation," Obermann said.
     
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