T-Mobile chief executive John Legere said Tuesday he “couldn’t be more excited” about possible deal-making in the telecom world. He also kept his cards close to his vest.
Legere acknowledged widespread speculation about potential industry and cross-industry mergers during his company’s quarterly conference call with analysts and investors.
He also noted that merger talks among companies essentially are forbidden for the moment by a federally imposed “quiet period” in place during a government auction of wireless airwaves licenses.
“Nobody’s talking to anybody,” Legere said during the call’s question-and-answer session after the company released its quarterly financial results.
The auction process is beginning to wrap up, and one estimate Tuesday said the quiet period might end April 19. The estimate came from Walter Piecyk, an analyst at BTIG Research, who has been tracking the auction process closely.
There has been plenty of talk about what might be coming in the wake of the auction.
Last week, Sprint chairman Masayoshi Son surprised many by saying the Overland Park-based wireless carrier may be a seller in whatever mergers and partnerships form. Sprint had been seen largely as a buyer with a particular interest in acquiring T-Mobile, which it had hoped to do three years ago.
Son said Sprint is strong enough to stand alone, be a buyer or take a role in a merger with some other company.
Legere said T-Mobile has many options too, including standing pat or being involved in industry consolidation.
“I got news for you, I couldn’t be more excited about the period that’s going to come up when this auction is over,” he said.
Analysts widely expect Sprint to seek a T-Mobile deal but caution that regulatory approval remains highly uncertain.
Regulators had rejected AT&T’s 2011 deal to buy T-Mobile for $39 billion, arguing that four national competitors were preferable to three. Similar federal pushback ended plans by Sprint’s parent company, SoftBank Group Corp., to seek a T-Mobile deal in 2014.
Craig Moffett, an analyst at MoffettNathanson, said evidence the regulators were right may have surfaced Monday when Verizon joined its three national rivals by offering an unlimited data plan for wireless subscribers. Sprint and T-Mobile did so last August, and AT&T offers unlimited data for wireless customers who buy its DirecTV service.
Moffett’s note to clients rhetorically asked: “Isn’t Verizon’s pricing response a sign that the four player market is working precisely as it should?”
As he often does, Legere took a swipe at many of his firm’s rivals and speculated about the options of a few.
Many, he said, face the prospect of a deal because they need help.
Sprint has valuable wireless spectrum assets, Legere said, “but they don’t have a franchise, and they’re a candidate for being a part of a greater organization either through scale or through something else.”
Sprint’s stock has climbed sharply for several months, which drew this comment from Legere:
“Somebody’s praying somebody’s going to help them out of their misery,” he said.
Dish Network must do a deal, Legere said, echoing one of his 2017 predictions made early last month.
The satellite television business owns valuable wireless spectrum but has no network to use it on. Moreover, Dish faces a regulatory deadline to put its spectrum to use.
“Going into this year, you know that Dish needs to do something,” Legere said Tuesday.
As for T-Mobile’s business, the company plans to open 2,500 stores this year, which comes on top of 1,400 last year.
The 2,500 include 1,000 stores for its prepaid Metro PCS brand that Legere said would end the year being offered at 10,000 locations, including many independent sites.
Executives said the expansion will help T-Mobile reach the one-third of the U.S. marketplace its retail footprint doesn’t currently cover.
In late January, Sprint had said it planned to open between 500 and 1,000 stores by mid-2018.