The stock price of Sprint Corporation (NYSE:S) fell more than 5% to $7.36 per share at the time of this writing around 1:02 in the afternoon in New York.On the other hand, the shares of T-Mobile US Inc (NYSE:TMUS), the fourth largest U.S. wireless carrier rose more than 7% to $33.14 per share.
The primary reason for the movement of the stocks was the report that Iliad SA (EPA:ILD), a French holding company active in the integrated telecommunications sector submitted a counter bid to acquire T-Mobile US Inc (NYSE:TMUS).
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Iliad offered to take over T-Mobile
According to the Wall Street Journal, Iliad SA (EPA:ILD) (OTCMKTS:ILIAY) submitted its proposal to T-Mobile US Inc (NYSE:TMUS) less than a week ago based on information from people familiar with the matter.
The sources said the details of the proposal of the French holding company are unclear, but one of the people indicated that Iliad SA (EPA:ILD) (OTCMKTS:ILIAY) wants to take over T-Mobile US Inc (NYSE:TMUS). The response of the fourth largest U.S. wireless carrier to Iliad’s proposal is unknown.
One of the sources said Iliad SA (EPA:ILD) (OTCMKTS:ILIAY) is working with several banks to obtain financing for the proposal. It is unknown how much the French holding company is willing to pay to acquire T-Mobile US Inc (NYSE:TMUS).
One-time opportunity to enter the world’s largest telecoms market
In France, Iliad SA (EPA:ILD) ignited a strong competition in the mobile market by offering aggressive rates. One of the sources suggested it bidding for T-Mobile US Inc (NYSE:TMUS) is a “one-time opportunity to enter the world’s-largest telecoms market.”
Iliad SA (EPA:ILD) (OTCMKTS:ILIAY) believed regulators in the United States would view its proposal positively because it is not an active player in the country, according to the sources.
Sprint and T-Mobile close to reaching a merger deal
Sprint Corporation (NYSE:S) and T-Mobile US Inc (NYSE:TMUS) have been working on a merger for months. There had been reports that the companies are close to reaching an agreement that could value T-Mobile to around $32 billion or $40 per share.
Market observers believed that any merger agreement between Sprint Corporation (NYSE:S) and T-Mobile US Inc (NYSE:TMUS) will face an intense scrutiny from antitrust regulators. The U.S. Department of Justice (DOJ) previously indicated skepticism regarding the proposed merger between Sprint and T-Mobile.