The reported T-Mobile US and Dish Network merger talks are not supported by major T-Mobile shareholder Deutsche Telecom.
New York Post sources revealed that the head of T-Mobile's controlling shareholder, Deutsche Telecom chief executive officer Timotheus Höttges, is not very keen and has spoken out against a T-Mobile merging with Charlie Ergen's Dish Network.
A union between the US wireless carrier and Sprint would be preferable and would create a better value, Höttges was reported to have told investors at an RBC Capital Markets Toronto road show.
Although Deutsche Telekom does not have the majority in T-Mobile's board, it owns 66 percent of its shares making DK the controlling shareholder.
The T-Mobile and Dish merger discussions were reported in the news last week. Both companies have however remained quiet on the state of the talks or the terms of the deal while a Deutsche Telekom spokesperson denies the New York Post story.
The pairing of the No. 4 wireless carrier and the No. 2 satellite television provider in the United States is seen to create a formidable competitor in the telecommunications industry. T-Mobile's rival carrier AT&T is also in merger talks with Dish's rival, DirecTV, according to CNN Money. Meanwhile, Charter Communications has already announced a merger plan with Time Warner Cable in a bid to challenge the No. 1 cable company, Comcast.
A T-Mobile and Dish combination is seen to facilitate the creation of new products and services using the spectrum. The union is also an advantage with Dish's links with major media companies. Both T-Mobile and Dish service millions of households.
Höttges has said he would keep his options open but he believed Comcast might buy or partner with a larger T-Mobile. The Deutsche Telecom CEO warns that a T-Mobile merger with Dish will not interest Comcast since a combined satellite business would raise regulation issues.
A Sprint team up may be possible in early 2016 when the Federal Communications Commission (FCC) starts to audition broadcast spectrum, Höttges added.
The Wall Street Journal reported however that the T-Mobile and Dish agreement already stipulated the leadership setup.
The T-Mobile and Dish Network merged company will have the wireless carrier's Chief Executive John Legere as the new company's CEO while Dish's chief Ergen will be the chairman.
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