The deal is structured as a recapitalization, in which MetroPCS will
declare a 1 for 2 reverse stock split, make a cash payment of $1.5
billion to its shareholders and acquire all of T-Mobile's capital stock
by issuing to Deutsche Telekom, its parent company, 74 percent of
MetroPCS' common stock.
The new company will keep the T-Mobile name, locate its headquarters
in Bellevue, Wash. (with a sizeable presence in Dallas, Texas) and
continue trading on the New York Stock Exchange. T-Mobile president and
CEO John Legere will keep his title for the new combined company, which
plans to operate the two brands as separate customer units led by
T-Mobile's Jim Alling and MetroPCS' Thomas Keys, respectively.
The companies believe the merger will offer more network coverage, a
broader product lineup and "a clear-cut technology path to one common
LTE network," and serves as a hedge against the increasing consolidation
at the top of the U.S. market, where rival carriers Verizon and
AT&T lead the market by a considerable margin.