Shares of MetroPCS Communications Inc. (NYSE: PCS) are looking for direction on reports that its shareholders have approved the takeover by T-Mobile. It was hard to not notice that shares rose 2.3% just yesterday and that as of yesterday’s close the stock had risen 6% in just the past week or so.
We have seen reports from both Bloomberg TV and Dow Jones that the merger, or takeover, has been approved. Standard & Poor’s recently said that it has MetroPCS on CreditWatch with positive implications now that the merger will bring a reduction in debt for the combined entity of some $3.8 billion. S&P also recently said that the merger creates an entity with greater scale, better wireless spectrum coverage and a greater chance for costs savings ahead.
To add for the support, we also had recently seen that Glass Lewis and ISS both had recommended that shareholders approve the merger proxy.
As of December 31, 2012, MetroPCS had approximately 8.9 million subscribers, and a recent release over results showed that of the 132.3 million Deutsche Telekom customers there were some 33.4 million under T-Mobile USA.
Our take is that MetroPCS should have gone ahead and resolved its differences with Leap Wireless International Inc. (NASDAQ: LEAP). That was then, this is now. MetroPCS is soon to be a part of the T-Mobile brand.