Sprint Corp., the fourth-largest wireless service provider in the U.S., is reportedly in talks about a wireless partnership with cable giants Charter Communications and Comcast Corp. Reuters reports that Sprint’s share prices were up by as much as 6% today after news broke about the talks.
“Sprint, controlled by Japan’s SoftBank Group Corp., has entered into a two-month period of exclusive negotiations with Charter and Comcast, while putting its merger talks with T-Mobile US Inc. on hold until the end of July, sources told Reuters,” the story reports.
The report cites Jonathan Chaplin, an analyst with New Street Research, saying a potential deal involving the companies could yield an estimated $35 billion-$40 billion in hard cost synergies. “However, there are strategic and economic benefits that may be far greater for all parties than just the direct cost savings,” Chaplin adds.
“Chaplin said the move was a ‘clear’ negative for T-Mobile, Verizon Communications Inc. and AT&T Inc.,” the report adds. Reuters notes that T-Mobile’s share prices fell 3.3% today to $61.06.