Mobile and Sprint merger approved: What you need to know

Ruben Fields
February 13, 2020

Once that happens, the number of major USA wireless companies would shrink from four to three.

The most significant concession: T-Mobile and Sprint had to sell off some of their owned-and-operated subsidiaries to a third company that will become a new nationwide wireless carrier. "Now we can get to work finishing what we set out to do - bringing a new standard for value, speed, coverage, quality and customer service to USA consumers everywhere and truly changing wireless for good".

The lawsuit filed in June by state attorneys general challenged the $26.5 billion deal, which was previously approved by the Justice Department and FCC.

U.S. District Judge Victor Marrero, it seems, sided with the latter. First, he said, they failed to convince the court that the merged party "would pursue anticompetitive behavior that, soon after the merger, directly or indirectly, will yield higher prices or lower quality for wireless telecommunications services".

The potential merger of T-Mobile and Sprint passed a major hurdle on Tuesday when a US District Judge ruled in favor of the merger.

"The deal would help Sprint to de-consolidate [$33 billion] of net debt", Bernstein analyst Chris Lane and Yan Li said in a Tuesday research note issued before the court decision was made public. That company is Dish, which is going to take over Sprint's Boost Mobile business.

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There was no immediate comment from the USA -led coalition to the report, which could not be independently confirmed. Photographs and video from the scene showed armored vehicles with US, Russian and Syrian flags next to each other.

"Today's decision marks a loss for every American who relies on their cellphone for work, to care for a family member, and to communicate with friends", James said in a statement.

Gigi Sohn, a fellow at the Georgetown Law Institute for Technology Law & Policy, said that while consumers are often promised benefits from mergers, "what they are left with each time are corporate behemoths who can raise prices at will, use their gatekeeper power to destroy competition and new voices and hijack regulatory and legislative processes". Shares of T-Mobile were up more than 10%.

"The court concludes that the proposed merger is not reasonably likely to substantially lessen competition in the" mobile service market, the ruling said, adding that the merger would "enhance competition in the relevant markets to the benefit of all consumers".

T-Mobile Chief Executive Officer John Legere said last week he was still optimistic that the deal would go through, though the terms could change.

American Tower's EVP Rodney Smith said during a UBS investment event last December that the company expected to see more spending from the new T-Mobile than it was seeing prior to the merger when T-Mobile and Sprint were operating as separate entities, according to a Seeking Alpha transcript. T-Mobile extended gains to as much as 13% to $95.23.

After winning regulatory approvals for combining their wireless networks past year, T-Mobile and Sprint still had to contend with a lawsuit filed by the attorneys general of several different states.

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