T-mobile Considers Sprint Nextel Takeover

Sprint Nextel shares jumped more than 13% early Monday on the prospect that it could be an acquisition target for Deutsche Telekom. The German telecommunications giant is reportedly prepared to make a bid for the U.S.'s third-largest wireless carrier by subscriber, according to the U.K. paper Sunday Telegraph. Sprint would presumably be folded into T-Mobile USA, combining two of the country's weaker nationwide players. But it wouldn't be cheap. An offer would have to exceed Sprint's current $11 billion market capitalization. While Wall Street has been eyeing further consolidation in the overcrowded U.S. wireless market, a combination between Sprint and T-Mobile is fraught with risk. Differing technologies, various problems at both carriers, and Sprint's sensitive U.S. contracts complicate any deal. The key obstacle to a smooth integration are the multiple technology standards that Sprint and T-Mobile employ. T-Mobile runs on a technology called GSM, while Sprint operates two more networks for its core Sprint service, as well as for its Nextel and Boost offerings, best known for their walkie-talkie feature.