The parent company of T-Mobile USA has confirmed it is in talks to buy rival MetroPCS in a deal that would give the combined company more clout in the competitive U.S. wireless market.
After weeks of speculation, German company Deutsche Telekom AG, which owns T-Mobile, said Tuesday that it was eyeing MetroPCS but that no decision had been reached yet.
“The talks are at a stage where significant issues have not yet been finalized, contracts have not yet been signed and the conclusion of the transaction is still not certain,” Deutsche Telekom said in a statement.
The company said it aimed to operate T-Mobile and MetroPCS within one company in which Deutsche Telekom would hold the majority of shares.
Dallas-based MetroPCS is the nation’s fifth-largest cellphone company, behind Verizon, AT&T;, Sprint and T-Mobile.
Last year, AT&T; announced it had agreed to buy Bellevue, Wash.-based T-Mobile USA for $39 billion. But the deal was called off after running into opposition from government agencies who said it would create a less competitive wireless industry and potentially lead to higher prices for consumers.
Telecommunications analysts have warned that a deal between T-Mobile and MetroPCS would be logistically challenging. The two companies use different network technologies, which prevents phones from one carrier from working on the other’s network.
But the two companies are currently deploying the same 4G technology, according to the Associated Press, which would make the networks compatible.
MetroPCS didn’t respond to a call for comment.
Shares of MetroPCS were up 17.9% to $13.58 at 11:30 a.m. Pacific time Tuesday.
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