(Reuters) - Sprint Corp (S.N) has restarted talks to merge with T-Mobile US Inc (TMUS.O), people familiar with the matter said on Tuesday, the latest effort to bring together the fourth and third largest U.S. wireless carriers.

FILE PHOTO: Smartphones with the logos of T-Mobile and Sprint are seen in this illustration taken September 19, 2017. REUTERS/Dado Ruvic/Illustration

The combined company would have more than 127 million customers and could create more formidable competition for the No. 1 and No. 2 wireless players, Verizon Communications Inc (VZ.N) and AT&T Inc (T.N), amid a race to expand offerings in 5G, the next generation of wireless technology.

T-Mobile’s and Sprint’s previous round of negotiations ended in November over valuation disagreements. Since then, Sprint’s shares have lost more than a fifth of their value amid questions about how the company can compete effectively under the weight of its long-term debt of more than $32 billion.

Sprint’s majority owner, SoftBank Group Corp (9984.T), has been looking to trim its debt, which reached 15.8 trillion yen ($147 billion) as of the end of December. It has said it is planning to raise cash by taking its Japanese mobile phone unit public this year.

Sprint and T-Mobile decided to restart talks partly because they want to share the financial burden of investing in their networks, the sources said. The negotiations are at an early stage, the sources added.

A key consideration in the talks is Germany’s Deutsche Telekom AG’s (DTEGn.DE) ability to consolidate T-Mobile’s earnings, one of the sources said. Deutsche Telekom owns 63 percent of T-Mobile, which has emerged as one of its more prized assets. Deutsche Telekom would likely have to put in new money toward

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