8-KRegulation FD

T-Mobile US, Inc. 8-K Report, Regulation FD Disclosure (May 20, 2019)

Filed May 20, 2019For Securities:TMUSTMUSZTMUSITMUSL

Summary

This T-Mobile US, Inc. 8-K filing from May 20, 2019, details significant commitments made by T-Mobile and Sprint to the Federal Communications Commission (FCC) as part of their proposed merger. The primary focus is on the parties' proposed divestiture of Boost Mobile and their extensive network buildout plans for 5G. Key investor takeaways include concrete commitments for nationwide 5G network deployment, with specific targets for population coverage and download speeds within three and six years post-merger. The filing also outlines commitments to enhance high-speed 5G services in rural America and introduce in-home broadband competition. Furthermore, the mandatory divestiture of Boost Mobile to a credible buyer is detailed, along with a six-year wholesale MVNO agreement, aiming to maintain robust competition in the prepaid market. These commitments are crucial for securing regulatory approval and represent a significant part of the combined entity's strategy and future operational landscape.

Key Highlights

  • 1T-Mobile and Sprint filed a presentation with the FCC detailing commitments for their proposed merger.
  • 2Commitment to build a world-leading nationwide 5G network, covering three-fourths of the U.S. population with mid-band spectrum and 97% with low-band spectrum within three years.
  • 3Pledged to accelerate deployment of 5G in rural America, aiming for significantly increased coverage and higher download speeds for rural populations.
  • 4Committed to launching in-home broadband service, targeting millions of households, including millions in rural areas, within three and six years post-merger.
  • 5Agreed to divest Boost Mobile, Sprint's prepaid brand, to a credible buyer with a six-year wholesale MVNO agreement.
  • 6Reaffirmed commitment to offer the same or better rate plans as of February 4, 2019, for three years post-merger.
  • 7The commitments are subject to verification measures and potential material voluntary contributions for missed deadlines.

Frequently Asked Questions

T-Mobile and Sprint have made several key commitments to the FCC, including building a comprehensive nationwide 5G network with specific coverage and speed targets, enhancing 5G services for rural America, introducing in-home broadband services, and divesting the Boost Mobile brand to ensure continued competition in the prepaid market. They also committed to maintaining current pricing for three years.

Within three years of closing, the combined company aims to cover three-fourths of the U.S. population with mid-band 5G spectrum and 97% with low-band spectrum. Within six years, they commit to at least 99% low-band and 88% mid-band population coverage, with specific download speed guarantees (e.g., 100 Mbps for nearly two-thirds of Americans within three years).

T-Mobile and Sprint have committed to divesting Boost Mobile to a serious and credible buyer. This divestiture will include a six-year wholesale MVNO agreement from the combined company, ensuring the buyer can compete effectively in the prepaid market. The buyer is to be identified and the MVNO agreement submitted to the FCC within 120 days of closing.

Yes, the parties have reaffirmed their prior commitment to offer customers the same or better rate plans at the same or better prices as those offered by T-Mobile or Sprint as of February 4, 2019, for a period of three years following the merger's completion.