Another proxy adviser has followed the path of ISS in advising against the proposed merger between MetroPCS and T-Mobile USA. Glass Lewis has communicated with its shareholders of the issues with the deal and has advised against it.
The move adds more pressure on T-Mobile USA's parent Deutsche Telekom AG to improve on the proposed merger's terms. Should the deal fail to push through, it would be a major blow against the German telecommunications giant after it was rebuffed for its previous plan to merge T-Mobile with AT&T. That US$39 billion deal was disallowed by federal regulators.
T-Mobile USA is the fourth largest mobile service provider in the United States. The deal would allow MetroPCS Communications to work together against larger competitors such as Verizon Wireless, AT&T and Sprint Nextel.
With the negative reactions both from within T-Mobile and MetroPCS, Deutsche Telekom may be forced to draft a better offer, such as reduction of the debt load and improving the corporate governance issues.
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