T-Mobile US Inc(NASDAQ:TMUS) is exploring taking over rival Sprint Corp(NYSE:S) in an all-stock deal, after SoftBank Group Corp offered to give up its majority ownership of Sprint. This is a major breakthrough in efforts to merge the third and fourth largest U.S. wireless carriers. Further, the deal would consolidate the U.S. telecommunications market significantly and would be the first transformative U.S. merger with significant antitrust risk to be agreed since the inauguration of U.S. President Donald Trump in January, testing his administration’s appetite for such deals. The deal has come as the telecommunications sector is seeking ways to tackle investments in 5G technology which will greatly enhance wireless data transfer speeds. After the terms are finalized, due diligence by the two companies will follow and a deal is expected by the end of October. As a result, Sprint Corp(NYSE:S) stock enhanced over 4.7% today (as of 1:42PM EDT on September 22^nd, 2017; Source: Google finance).

Moreover, Japan’s SoftBank Group Corp, that controls Sprint, will own 40 to 50 percent of the combined company, while T-Mobile majority owner Deutsche Telekom will own a majority stake.

The merger between T-Mobile and Sprint would create a business with more than 130 million subscribers, just behind Verizon Communications Inc and AT&T Inc. Revenues would be more than $70 billion and analysts say there would be massive scope to cut costs. T-Mobile has a market capitalization of $52 billion, while Sprint has a market capitalization of $32 billion.

Meanwhile, Sprint and Deutsche Telekom has declined to comment. T-Mobile and SoftBank did not immediately respond to requests for comment. SoftBank founder Masayoshi Son abandoned an earlier attempt to acquire T-Mobile for Sprint in 2014 amid opposition from anti-trust regulators concerned that consumers could lose out.

The deal is also expected to face regulatory scrutiny over concerns that the U.S. wireless market is becoming too concentrated.

On the other hand, Sprint, which had earlier approached cable company Charter Communications Inc about a potential merger, has now put plans for a bid for Charter on the back burner as it focuses on negotiations with T-Mobile. French cable mogul Patrick Drahi’s Altice USA Inc, is continuing to work on a potential bid for Charter.