Exclusive: T-Mobile, Sprint could sell Boost for up to $3 billion, potential bidders say

A group of potential buyers is preparing offers for the prepaid wireless brand Boost Mobile in a forthcoming sale that values ​​the subsidiary of US wireless operators. UU T-Mobile US Inc and Sprint Corp up to $ 3 billion, interested buyers told Reuters.

The $ 26 billion agreement between T-Mobile and Sprint won approval from the US Federal Communications Commission. UU Last week, after the two companies offered concessions. It included the sale of Boost to reduce the combined company’s market share in the prepaid wireless business, where customers pay for telephone service earlier in the month and are not required to pass a credit check.

While the agreement awaits a decision from the US Department of Justice, interested parties are already preparing bids. The sale process is expected to begin after review by the Department of Justice.

Q Link Wireless, a prepaid brand and third-party provider of federally-assisted wireless plans, is preparing a package to bid for Boost with private equity backing and could pay between $ 1.8 billion and $ 3 billion, the founder and managing director told Reuters. , Issa Asad. .

The price will depend on the quality of Boost customers, such as their level of abandonment, or the rate of customer cancellations, the devices they use and the type of phone plan they are in, none of which companies They have revealed, he said.

This month, Cowen analysts estimated that Boost has between 7 and 8 million customers and a transaction could be valued at 4.5 billion dollars if the agreement included the wireless spectrum or airwaves that transport data and facilities. Sprint has not disclosed the number of Boost customers.

Stephen Stokols, executive director of the prepaid wireless service company FreedomPop, said an undisclosed private equity group he’s talking to has put the future value of Boost at around $ 4 billion, as in an initial public offering. .

Although FreedomPop is not a bidder, Stokols said it is advising a private equity group to prepare an offer. If that offer is successful, he believes that the group would combine its acquisition with FreedomPop and would run a combined company with Boost’s assets.

Peter Adderton, founder of Boost Mobile that sold the US business. UU Nextel in 2004, which was later acquired by Sprint, also said it is interested in buying back Boost. He refused to comment on his assessment for the business.

Adderton said he and his lawyers have urged regulators to demand that T-Mobile and Sprint also strip the wireless spectrum to ensure Boost is a viable competitor in the market.

Adderton added that regulators should also ensure that the new T-Mobile does not employ anti-competitive practices to harm Boost, and that the contract between the companies should not be exclusive, which would allow Boost to buy access to the network of other operators.

The current sales agreement lacks details, but with the right terms, “we can create a dynamic player that will compete in the market,” Adderton said of Boost.

T-Mobile and Sprint did not respond immediately to requests for comments.

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