Iliad swoops in with $15b bid for T-Mobile

Rob Powell/Telecom Ramblings

Yes, a bid landed on the table for T-Mobile today from a foreign wireless carrier backed by a billionaire with a talent for disruption. But it wasn’t from Softbank and Masayoshi Son was not involved. The French carrier Iliad, which is backed by Xavier Niel, has come out of nowhere to offer $15 billion in cash for a 56.6% stake in T-Mobile US.

Softbank and Sprint have been widely rumored to be preparing for a buyout of T-Mobile US,  but have been moving cautiously after getting an initial negative response to the idea from regulators. Iliad wouldn’t face the same issues, since they aren’t in the US market and thus wouldn’t reduce competition.

However, Deutsche Telekom AG doesn’t appear to be too enamored with the idea, with those $40/share plans with Softbank looking rather larger than the $33/share Iliad is proposing. But given the easier regulatory path, if Iliad has room to bid a bit higher then DT just might bite. But just where the financial rationale for Iliad’s current bid comes from seems a bit mistifying to analysts since the synergies available seem rather minimal.

T-Mobile’s disruptive strategy in the US is similar to what Iliad has been doing in France, however, and perhaps that is what has grabbed Niel’s attention. But it sure does seem like he’d be doubling down on an already risky strategy.

Masayoshi Son already sent one fellow maverick billionaire rival packing in his takeout of Sprint and Clearwire. Now another has lined up to take him on. This could get interesting.

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