UBS Says DT Would Also Need a Deal with Leap (LEAP) to Gain Full Spectrum (PCS)

Following earlier reports Deutsche Telekom may be in talks to do a deal with MetroPCS (NYSE: PCS), UBS's John Hodulik believes Deutsche Telekom would also likely need to do a deal with Leap Wireless (Nasdaq: LEAP) in order to capture the remainder of US spectrum. Hodulik said merging T-Mobile USA into MetroPCS would only give the company half of US coverage.

The analyst did warn of some "execution risk" related to a deal between T-Mobile and MetroPCS as the former runs a GSM network while the latter runs a CDMA network.

Shares of MetroPCS are up 15 percent amid Wednesday's headlines; Leap Wireless shares are up about 12.5 percent to $5.78.

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