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Sprint, T-Mo ‘Have Hit a Very Rough Time,’ Says CNBC’s Faber

Faber’s on-air comments yesterday seemed to offer a more upbeat assessment compared to a Nikkei Asia Review article at mid-day that had said SoftBank (9984JP), Sprint’s owner, was simply calling off talks.

Faber’s tone today is more negative.

Referring to multiple unnamed sources, Faber writes that “these two companies are still talking, they had focused on this week being the week they would come to some sort of agreement on price."

While T-Mobile, which has been "doing it’s due diligence,” has “questions about price, from their side,” relates Faber, “that is being met from SoftBank's new unwillingness to give in on governance,” referring to SoftBank chairman Masayoshi Son’s concern about who would control a combined company.

Faber relates that both parties seemed to be initially in agreement on Deutsche Telekom (DTE), parent of T-Mobile, controlling things.

“DT said we need to consolidate the combined company on our balance sheet, to be the controlling shareholder. Everything I had heard was that Masa San had agreed."

That leads Faber to observe, “It seems somewhat odd that they are now suddenly going back to governance, and concern over not having control or a very significant influence,” meaning SoftBank.

Faber seems to have one the one hand, on the other hand, and then on several other hands.

"Will they be able to surmount these concerns?” he asks. “It’s very much unclear. I am getting a more and more pessimistic read from people involved, but reports this thing are over are premature, but it has hit a very rough time, and it is very bizarre how it evolved to this point."

"Things seem to be deteriorating, and he [Masayoshi Son] does appear to have issues with governance that he didn’t a short while ago, but to be fair he always had issues."

"If you asked me would this deal break down over this, I would have said no, not this."


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