Sprint moves ahead with T-Mobile bid plan, discusses funding with banks

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Sprint Corp is meeting banks to work out funding for its bid for smaller rival T-Mobile Inc, a source familiar the situation said, as the mobile carrier works to ease regulatory concerns that the deal would hurt competition.

The source said that Sprint, which is owned by Japan’s SoftBank Corp, is hoping to fund the bulk of T-Mobile’s estimated $50 billion tag corporate bonds and cover the rest syndicated loans and convertible bonds.

Sprint is currently talking to at least five banks, the source told Reuters, including JP Morgan, Goldman Sachs and Deutsche Bank.

Bloomberg, which first reported that Sprint in talks banks Thursday morning in Asia, said the carrier also talking to Mizuho Financial Group Ltd and Citibank. Softbank is expected to a formal offer in June or July, Bloomberg added.

Sprint spokeswoman Roni Singleton told Reuters the does not comment rumors and speculation. T-Mobile and SoftBank both declined to comment the Bloomberg .

Sprint is facing a battle ahead with U.S. regulators who oppose consolidation in the wireless market the basis would inhibit competition. The is aware may have to give some of its spectrum holdings to over critics, the source said.

Two of the most vocal opponents to the deal are Federal Communications Commission Tom Wheeler and U.S. antitrust chief William Baer, who have pointed to T-Mobile’s success since U.S. authorities rejected a 2011 merger between AT&T Inc and T-Mobile on the grounds the market needs at least four players to be competitive.

The failure of that deal cost AT&T a $6 billion break- fee, a penalty Sprint feels confident can avoid, the source said, adding that is leaning towards having Deutsche Telekom, which currently owns 67 percent of T-Mobile, retain part of that stake.

SoftBank chief executive Masayoshi Son is lobbying regulators by arguing his purchase of a U.S. mobile operator would break a cozy oligopoly dominated by AT&T and Verizon Communications Inc, pointing to the he initiated when he took over Vodafone’s failing Japanese operation eight years ago.

T-Mobile has a market cap of $23.52 billion, according to Thomson Reuters data. (Reuters)