T-Mobile CEO to Step Down May 1, Still Expects to Complete Sprint Buy

Legere said T-Mobile’s recent offer to launch 5G in December, provide free connections for first responders and help close the homework gap (see 1911070066) was “extremely well received, certainly by first responders and families that are hoping to have ways for their children to do their homework, as well as people who are worried about the low end of the market.”

Legere shared the details of the latest “uncarrier” announcement with state attorneys general, and they also viewed it as positive, he said. “These are areas that they’re all quite strongly interested in,” he said: “We continue to have very good dialogue with them.”

A federal judge set a status conference in states’ challenge to T-Mobile/Sprint for Thursday at 3:30 p.m. at the U.S. District Court for the Southern District of New York. Magistrate Judge Robert Lehrburger ordered the meeting Monday in case docket 1:19-cv-05434-VM-RWL. The carriers and the lead state litigant, New York Attorney General Letitia James (D), didn’t comment.

Parties asked for the court’s guidance on pretrial matters, including permission to provide opening statements of at most one hour, and about pretrial memos and confidentiality issues, in a Nov. 13 letter (in Pacer) released Monday. The trial starts Dec. 9.

Legere said he has also been speaking to labor unions “and seeing if there are ways for us to build bridges.” T-Mobile has “the basis” for a settlement with the states suing to block the Sprint deal, he said. “I feel equally as good, if not better, on our ability to win this case in a trial.”

Chief Financial Officer Braxton Carter, who was expected to leave at year-end, has agreed to stay on through July 1, and Chief Technology Officer Neville Ray was named president-technology and will also stay. The announcement had been in the works for years, though T-Mobile had expected the Sprint deal to be approved six months ago, Legere said: “It’s Mike’s time. We know that. He’s ready.” The announcement now should reassure the New York court T-Mobile’s competitive push will continue, he said.

Legere said he's “not retiring” and has had inquiries from other companies. “It can’t be companies I hate, which eliminates Verizon and AT&T from the list,” he said. Legere said he had not been approached to take the vacant CEO job at WeWork, despite rumors. “This move has been under development for a long time and I couldn’t be more confident in the future of @TMobile under [Sievert’s] leadership,” Legere tweeted Monday.

In another twist, Boost Mobile founder Peter Adderton said Monday he's willing to pay up to $2 billion to buy back the prepaid brand from Sprint. Boost is slated to go to Dish Network as part of the agreement worked out with DOJ. Dish is “substantially underpaying” for Boost, he said on CNBC’s Squawk Alley. Adderton said his offer should be attractive to the states opposing the deal. Dish will need a new group of subscribers to cover the cost of a planned $10 billion network, he said: “The prepaid, low-incomes customers … are not going to cut it.”

Adderton said he has discussed the offer with Dish. “Sprint has an obligation to its shareholders to maximize the value” of Boost, he said. Dish and Sprint didn’t comment. He said prepaid customers are unlikely to see the benefits of 5G for at least three years.

“The announcement of the transition is no surprise,” New Street’s Jonathan Chaplin told investors: “Sievert has been the heir apparent for some time; however, the timing is a little surprising. The company attributes the timing to removing an uncertainty around the continuity of leadership and of the Un-carrier strategy ahead of the trial. This strikes us as plausible.”

“The company was very clear this announcement in no way changes its view on getting the Sprint deal done,” said Wells Fargo’s Jennifer Fritzsche.