Ryan Reynolds-backed mint bought by T-Mobile for $1.35 billion

(Bloomberg) — T-Mobile US Inc. buys Mint Mobile, a budget wireless provider owned by actor Ryan Reynolds, for $1.35 billion to bolster its prepaid phone business and attract more low-income customers.

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The US’s second-largest wireless carrier is acquiring Mint’s parent company, Ka’ena Corp., in exchange for 39% cash and 61% equity, according to Wednesday’s announcement. The final purchase price will depend on Mint achieving certain performance metrics both before and after the transaction is closed. The sale talks were first reported by Bloomberg News in January.

Reynolds, who owns an undisclosed but “significant” stake in Mint, will continue to appear commercially on behalf of the company, co-founder David Glickman said in an interview, adding that the actor has incentives to “keep going for years.” Glickman and partner Rizwan Kassim will join T-Mobile and run the business, which includes Ultra Mobile, an international telephone service.

Mint offers some of the cheapest data plans in the country, starting at $15/month for 4GB of wireless data. The companies do not disclose the number of Mint subscribers. According to Glickman, the annual increase in the number of subscribers over the past four years was 50%, and revenue growth was 70% or more per year.

The company has no stores and sells phones and mobile data plans entirely online. The service is provided by T-Mobile already under a wholesale network sharing agreement.

“The Mint formula is working, the brand is growing fast, and we can spur it on with phone purchasing power and marketing,” said Mike Katz, president of marketing for T-Mobile. The Bellevue, Washington-based carrier also operates its own prepaid brand called Metro.

The pay-as-you-go market is seen as a source of overall subscriber growth as customers experiencing credit issues end up being forced to receive regular monthly bills. Mint competes with other prepaid phone brands including Cricket by AT&T Inc., Total by Verizon Communications Inc. and Boost Mobile by Dish Network Corp.

T-Mobile expects the deal to close later this year and does not expect any changes to its 2023 financial projections. The Mint will “slightly increase” adjusted earnings before interest, taxes, depreciation and amortization. Shares were virtually unchanged at $143.09 on Wednesday morning in New York.

Reynolds, the seller and co-owner of Aviation Gin, sold the brand to Diageo Plc in 2020 for $610 million, with nearly half of that potential payout contingent on 10 years of sales results. The actor, best known for his work on the superhero series Deadpool, met Glickman through their collaboration with the Michael J. Fox Parkinson’s Foundation. Reynolds is also the co-owner of the Welsh football team Wrexham AFC, which was featured in a docu-series on the FX network.

“We’re so happy that T-Mobile defeated my mom Tammy Reynolds’ aggressive last-minute bid as we believe the superiority of their 5G network will provide a better strategic match than my mom’s slightly above average mahjong skills,” he joked. Reynolds. in a statement.

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