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T-Mobile has agreed to acquire Mint Mobile, a low-cost cellular carrier that is partially owned by Ryan Reynolds, in a deal that may be worth up to $1.35 billion, the firm said on Wednesday. It’s clear from the action that T-Mobile wants to expand its prepaid options.
T-Mobile said in a blog post that it has struck an agreement to buy wireless wholesaler Plum and Ka’ena Corporation, the parent company of prepaid cellular brands Mint Mobile and Ultra Mobile, for up to $1.35 billion in a mix of 39% cash and 61% stock. Based on Mint’s performance over specific time periods prior to and following the transaction, the ultimate acquisition price will be determined. T-Mobile anticipates concluding the agreement later this year.
T-Mobile CEO Mike Sievert stated in a statement, “Mint has built an incredibly successful digital direct-to-consumer business that continues to deliver for customers on the Un-leading carrier’s 5G network, and we are excited to use our scale and owners’ economics to help supercharge it – and Ultra Mobile – into the future. “Long-term, we’ll gain from implementing the marketing strategy for which Mint has grown to be known throughout additional T-Mobile divisions. Customers will really benefit, in our opinion, from a more aggressive and comprehensive Mint and Ultra.”
Following the deal’s close, Ryan Reynolds will continue in his creative role on behalf of Mint and continue appearing in commercials. Mint founders David Glickman and Rizwan Kassim will remain onboard at T-Mobile to manage the brands, which will generally operate as a separate business unit.
T-Mobile began considering its purchase of Mint Mobile in January, according to a report from Bloomberg.
As Mint Mobile only does business online, the company lacks any actual retail locations. As part of a wholesale network-sharing arrangement, T-Mobile already offers the carrier’s service. In this case, Mint Mobile is a mobile virtual network operator (MVNO), which implies that it does not own and operate a wireless network but rather purchases wholesale access to one.
The sales, marketing, digital, and service activities of Mint Mobile will be acquired by T-Mobile, which also expects to leverage its distribution network and supplier contacts to assist the brands in expanding and providing a wider range of devices at reasonable prices to more customers. To reach new client categories and geographical areas, the business will also use Mint’s digital D2C marketing.
The company says Mint Mobile and Ultra Mobile join its current prepaid service offerings, which include Metro by T-Mobile, T-Mobile branded prepaid and Connect by T-Mobile.