T-Mobile seen as top target following AT&T-Time Warner deal

Tue Oct 25, 2016 1:18pm EDT
 
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By Malathi Nayak

NEW YORK (Reuters) - T-Mobile US Inc is the likeliest acquisition target as media companies seek a wireless partner following AT&T Inc's proposed $85.4 billion takeover of Time Warner Inc, analysts said.

AT&T announced the deal late on Saturday, stoking urgency in the telecoms and media sectors, where carriers facing a saturated wireless market are looking for content to attract mobile users and producers of shows and movies are seeking digital distribution.

T-Mobile took most of the wireless industry's subscriber and revenue growth in the third quarter. Its strong balance sheet and fast-growing wireless business makes it an attractive target for a pay-TV or media company, analysts said.

T-Mobile shares jumped 9.5 percent on Monday after it announced third-quarter financial results. At least nine analysts raised their target price on the No. 3 wireless company, which said it added 851,000 postpaid subscribers in the quarter.

T-Mobile has taken market share from bigger rivals Verizon and AT&T, and that momentum is expected to continue, analysts said.

"The takeout target over the next twelve months has got to be T-Mobile," New Street Research analyst Spencer Kurn said. Potential buyers include Comcast Corp, satellite-TV provider Dish Network Corp, and Mexican telecom company America Movil, analysts said.

Comcast and Dish declined to comment. America Movil could not be immediately reached for comment.

"Content of all kind is rapidly landing on the internet and the internet itself is rapidly transforming toward mobile," T-mobile Chief Operating Officer Mike Sievert told Reuters.   Continued...

 
People pass by a T-Mobile store in the Brooklyn borough of New York June 4, 2015.  REUTERS/Brendan McDermid