{"id":20142,"date":"2017-01-23T09:24:13","date_gmt":"2017-01-23T09:24:13","guid":{"rendered":"http:\/\/www.biphoo.com\/bipnews\/?p=20142"},"modified":"2017-01-23T09:24:13","modified_gmt":"2017-01-23T09:24:13","slug":"jp-morgan-sees-u-s-telecom-sector-consolidation","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/technology\/jp-morgan-sees-u-s-telecom-sector-consolidation.html","title":{"rendered":"JP Morgan sees U.S. telecom sector consolidation"},"content":{"rendered":"
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JP Morgan sees U.S. telecom sector consolidation<\/span><\/strong><\/span><\/h2>\n

JP Morgan sees U.S. telecom sector consolidation:- <\/strong><\/span>U.S. telecom sector could be on the brink of a major consolidation under President Donald Trump’s likely more merger-friendly administration, said JP Morgan Securities, which now sees a 90 percent chance of T-Mobile US being involved in a strategic transaction in the next five years.<\/span><\/p>\n

T-Mobile could be involved in tie-up with Sprint Corp (S.N), or be acquired by a cable company, JP Morgan said, adding that a transaction involving Dish Network Corp (DISH.O) or a sale to a foreign player that wants a foothold in the U.S. wireless market is also likely.<\/span><\/p>\n

Sprint dropped its bid to acquire smaller rival T-Mobile in August 2014 due to continued regulatory resistance.\u00a0<\/span><\/p>\n

A potential combination of Sprint and T-Mobile is seen as the most compelling, with the likelihood of a deal between the two wireless carriers now at more than 35 percent, up from 10 percent in September, with a 70 percent chance of approval, if announced, JP Morgan analyst Philip Cusick said.<\/span><\/p>\n

Japan’s Softbank Group (9984.T), which owns more than 80 percent in Sprint, had pledged investment in the United States last year, reviving speculation that Sprint and T-Mobile may rekindle merger talks.<\/span><\/p>\n

JP Morgan upgraded Deutsche Telekom (DTEGn.DE), which owns almost 65 percent in T-Mobile, to “overweight” from “neutral” and raised its price target to 19.50 euros from 16.20 euros to reflect a 35 pct probability of a U.S. transaction.<\/span><\/p>\n

“We believe that parents Softbank and Deutsche Telekom have increased their preference for a tie-up in the last six months and that the value of about $5 billion of annual synergies is enough to smooth over most disagreements on relative value,” Cusick said.<\/span><\/p>\n

Deutsche Telekom Chief Executive Tim Hoettges said in November that the company was “not in the mood” to sell T-Mobile, although it was watching for any change in the U.S. regulatory environment under Trump’s administration.<\/span><\/p>\n

Cusick estimated a 20 percent chance of T-Mobile continuing to operate as a standalone business in the next five years.<\/span><\/p>\n

Shares of T-Mobile closed at $59.62 and Sprint at $8.93 on Friday. Deutsche Telekom shares closed at 16.42 euros.<\/span><\/p>\n

Source:-\u00a0http:\/\/www.reuters.com\/article\/us-t-mobile-us-research-idUSKBN1570UN<\/span><\/div>\n

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