Sprint and T-Mobile shares hit by reports of scrapped bid
Shares in US telecoms firm Sprint fell 16% in after-hours trading on Tuesday following reports that it had dropped a bid to buy T-Mobile US.
Shares in T-Mobile also fell 9% after reports that the Sprint bid had foundered on regulatory resistance.
T-Mobile US had been expected to seal an agreement to tie up with US rival Sprint Nextel.
Last week, French start-up Iliad made a rival cash offer of $15bn (£8.9bn) for a 56.6% stake in T-Mobile US.
Iliad is now expected to work on a higher offer in conjunction with US cable and satellite companies, including Dish Networks, Cox Communications and Charter Communications, according to reports.
Sprint's parent company, Softbank, decided to drop its T-Mobile US offer after failing to overcome regulatory resistance despite months of lobbying, reports said.
"We didn't think the opposition would be this strong," a SoftBank executive told the Reuters news agency, but added: "The environment will definitely change."
Softbank shares slid 5% in early morning trading in Tokyo on Wednesday.
Sprint, the third largest US mobile network, and T-Mobile US, which is the fourth largest, have not ruled out consolidation in the future.
However, US regulators want to keep the number of major US mobile firms to four, rather than three, reports said.
Following the failed talks, Sprint chief executive Dan Hesse will be replaced by Marcelo Claure, founder of mobile phone distributor Brightstar, reports added.