Investors are worried again about the prospects of Sprint Nextel.
On Tuesday, shares of Sprint had slipped by nearly 5 percent after Deutsche Telekom said that it was in talks to buy MetroPCS and merge it with its T-Mobile USA unit.
If Deutsche Telekom acquires MetroPCS, Sprint could face a newly emboldened competitor.
Sprint, which has 56.4 million customers, ranks as the third-largest cell phone provider in the United States, significantly trailing AT&T and Verizon. T-Mobile USA, the American subsidiary of Deutsche Telekom, has 33.2 million customers, according to the industry consulting firm Ovum.
But the acquisition of MetroPCS would significantly bolster T-Mobile's business. Combined, the two carriers would have 42.5 million customers, significantly closing the gap with Sprint.
Sprint had tried to buy MetroPCS in a bid to bulk up its business. But the deal fell apart this year after Sprint's board rejected the proposed takeover.
Sp rint's management has moved to improve the company's fortunes. It added the iPhone to its lineup and invested in customer service in an effort to combat the attrition problem. Over the last 12 months, shares of Sprint have more than doubled.
But the company continues to struggle financially. In the second quarter, the company lost $1.4 billion, compared with a loss of $847 million the previous year.
