MetroPCS advises investors to say yes to T-Mobile merger

(Credit: Greg Sandoval/CNET)

MetroPCs wants its shareholders to vote thumb's up on the T-Mobile merger.

In a letter sent today by MetroPCS to its investors, the company said it could provide no assurance that it would offer better shareholder value remaining as a standalone carrier, according to Reuters. If approved, the deal would see MetroPCs declare a 1-for-2 reverse stock split and give its stockholders 1.5 billion back in cash.

Investors would actually own 26 percent of the combined company, while T-Mobile USA parent would wind up with the remaining 74 percent.

The letter urging approval of the merger is clearly a response to recent calls to vote against the deal. Investment firms Paulson & Co. and P. Schoenfeld Asset Management and advisory group Institutional Shareholder Services have all been urging MetroPCS stockholders to say no to the merger.

Paulson & Co. and P. Schoenfeld Asset Management both own stakes in MetroPCs and believe the deal undervalues the company's financial worth. ISS has said that stockholders should also fight for a bigger slice of the company than just 26 pe... [Read more]