Sprint/T-Mobile ‘may auction Boost Mobile’ if Dish doesn’t move fast
Goldman Sachs may run an auction to find a buyer for Sprint’s Boost Mobile operation if Dish Network does not conclude a deal quickly.
That is the implication of a report yesterday that the investment bank is casting around for an alternative buyer for the division, which Sprint is selling so it can get US approval for its merger with T-Mobile US.
The Reuters news agency said, citing two unnamed people “familiar with the matter”, that Goldman is considering an auction, and “is expected to send out books to prospective buyers in two weeks”.
Earlier this week the usual sources were giving the impression that Dish, a satellite TV company founded nearly 40 years ago, was moving quickly to take over Boost, a mobile virtual network operator (MVNO) that is owned by Sprint and uses Sprint’s infrastructure.
Unconfirmed reports were quoting a price of $6 billion, nearly twice the sum suggested when Amazon emerged as an early front-runner for Boost. Now, it appears that cable operators Comcast, Charter Communications and Altice USA are all in the running – though no one is confirming anything.
The Sprint/T-Mobile US merger will create a company valued at $26.5 billion, and build a strong third competitor in the US mobile market to AT&T and Verizon. Sprint is majority owned by SoftBank, and T-Mobile US is majority owned by Deutsche Telekom, which will have control of the resulting merged operation if it gets through all the regulatory hurdles.
According to the Reuters report, “Goldman has told prospective buyers as late as Tuesday that it is preparing for an upcoming auction of Boost”, though the process is “moving slowly”.
The offer may or may not include spectrum – one of the areas that is still confused.
The Federal Communications Commission (FCC) has approved the deal, but the Department of Justice (DoJ) is being harder to persuade, with staff believed to be against. In addition, attorneys general in nine states – including Californian and New York – plus Washington DC have started legal action to block it.
The Reuters report, which has not been independently corroborated, says that Boost’s buyer will be able to run on the combined T-Mobile and Sprint network.
T-Mobile US has said that, if the merger is approved, the combined network will be expanded to provide 5G services to 97% of the US population by 2022.