A bid for T-Mobile US Inc. by French mobile-phone carrier Iliad SA probably would face fewer objections from U.S. regulators than any bid submitted by Sprint Corp.
Billionaire Masayoshi Son, whose SoftBank Corp. gained control of Sprint last year, has made a case that regulators should consider letting Sprint and T-Mobile US combine, though he has yet to formally bid. That would leave three nationwide carriers rather than four, a reduction that U.S. antitrust authorities have warned against.
If Iliad succeeds with its $33-a-share offer for a 56.6 percent stake in T-Mobile, the No. 4 U.S. mobile carrier would remain independent.
“It wouldn’t eliminate any competition,” Paul de Sa, a New York-based analyst at Sanford C. Bernstein & Co., said in an interview. “It would face fewer regulatory hurdles.”
Paul Gallant, a Washington-based analyst with Guggenheim Securities LLC, said an Iliad deal “shouldn’t be nearly the regulatory food fight that Sprint-T-Mobile would be.”
“At first glance I don’t see any reason why this wouldn’t be approved,” Gallant said. “There don’t seem to be any real competition issues and I don’t expect foreign ownership slows this down, either.”
Asked if foreign ownership might be an issue, de Sa replied: “You mean, unlike SoftBank and Deutsche Telekom?”
Deutsche Telekom AG, based in Bonn, is the parent company of T-Mobile US. SoftBank is based in Tokyo.
“On its face it’s competition neutral, and it would be much easier to get through,” said Harry First, a professor at New York University who teaches antitrust law.
A Sprint acquisition of T-Mobile, though, would probably be challenged by the Justice Department, which sued to block AT&T Inc.’s plan to buy T-Mobile in 2011, First said.
An Iliad deal would still need to undergo a national security review, “an issue that most likely would work out fine,” Paul Glenchur, a senior Washington-based analyst with Potomac Research Group, said in an interview.
Paris-based Iliad in a statement today said its bid for T-Mobile “should not raise any antitrust issue in light of the competition rules given that Iliad is not present in the United States.”
Iliad, the fourth-largest French mobile company, has offered deeply discounted subscriptions that force larger carriers to sacrifice profits to keep up. Similarly, T-Mobile, based in Bellevue, Washington, has roiled the U.S. wireless industry with no-contract plans, and by separating the cost of smartphones from payments for wireless service.
There’s no guarantee Iliad will prevail -- Deutsche Telekom considers its offer inferior to the bid planned by Sprint, said a person familiar with the matter.