Merger talks between T-Mobile US and Sprint, two rivals in the U.S. telecommunications market, have broken down, the two companies said Saturday in a joint statement. T-Mobile, a subsidiary of Germany's Deutsche Telekom, and the smaller Sprint, were "unable to find mutually agreeable terms," the statement said. T-Mobile said that while the possibility of combining with Sprint was compelling for a variety of reasons, the prospective merger did not add up to all the company had hoped.

"We have been clear all along that a deal with anyone will have to result in superior long-term value for T-Mobile's shareholders compared to our outstanding stand-alone performance and track record," said John Legere, president and chief executive of T-Mobile US. Sprint's president and chief executive Marcelo Claure said that while the company recognizes the benefits of "scale through a potential combination," an agreement with T-Mobile could not be reached.

"We have agreed that it is best to move forward on our own," Claure said, adding that the company aims to keep growing by investing in its network.

A merger would have created a much larger player to compete with AT&T and Verizon. T-Mobile is the third-largest U.S. cellular carrier with a market value of nearly $50 billion. Sprint is number four in the U.S. market with a market valuation of about $26 billion.