The parent company of T-Mobile agreed to buy MetroPCS on Wednesday, as the cell phone providers look to compete with bigger rivals.
The merger is aimed at making T-Mobile a more robust competitor to Sprint Nextel, particularly in low-cost cellphone service. The deal will also help T-Mobile gain more customers and resources to build out a next-generation data network.
Under the terms of the complex transaction, MetroPCS will conduct a 1-for-2 reverse stock split and pay out $1.5 billion in cash to its existing shareholders, or about $4.09 a share. It will then issue new stock worth about 74 percent to T-Mobile's parent, Deutsche Telekom, leaving existing MetroPCS investors with a 26 percent stake.
Morgan Stanley advised Deutsche Telekom's board, while Lazard advised the German telecom's management team. Legal advice was provided by Wachtell, Lipton, Rosen & Katz, Cleary Gottlieb Steen & Hamilton, K&L Gates, and Wiley Rein.
MetroPCS was advised by JPM organ Chase, Credit Suisse and the law firms Gibson, Dunn & Crutcher, Paul Hastings and Telecommunications Law Professionals. A special committee of its board was advised by Evercore Partners and the law firms Akin Gump and Fulbright & Jaworski.
