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Federal judge clears the way for Sprint/T-Mo merger

Merger could close as soon as April 1

With a federal judge rejecting the claims of state attorneys-general that the merger of T-Mobile US and Sprint will reduce competition, T-Mobile US could be looking at closing the merger that will reshape the U.S. telecom landscape as soon as April 1.

T-Mobile US’ stock surged 11% in midday trading Tuesday on the news, while Sprint shares jumped nearly 73%.

U.S. District Court Judge Victor Marrero said that he found T-Mobile US executives credible in their commitments to continue competing aggressively with AT&T and Verizon, agreed that Sprint by itself was in a weak position and that the creation of a fourth facilities-based competitor through divestment of assets to Dish Network would reduce any impacts to the telecom market’s overall competitiveness.

“Today was a huge victory for this merger … and now we are FINALLY able to focus on the last steps to get this merger done!” said T-Mobile US CEO John Legere in a statement. He went on to jab at his favorite targets, AT&T and Verizon, adding, “The broad and deep 5G network that only our combined companies will be able to bring to life is going to change wireless … and beyond. Look out Dumb and Dumber and Big Cable – we are coming for you … and you haven’t seen anything yet!”

If the April 1 date holds true, the merger will be formally completed before Legere’s scheduled departure from the CEO role on April 30. Mike Sievert, T-Mobile US COO and CEO-to-be, said that the carrier is “laser-focused on finishing the few open items that remain but our eye is on the prize: finally bringing this long-awaited merger and all the goodness it will deliver to a close as early as April 1, 2020.”

Those items include a separate legal approval for the related Dish Network settlement (which includes asset divestment to Dish of Sprint’s prepaid businesses, some 800 MHz spectrum and access to wireless infrastructure sites so that it can become a fourth facilities-based competitor) and approval from the California Public Utility Commission. T-Mobile US noted in its press release on the court decision that the remaining closing conditions include “possible additional court proceedings, and satisfactory resolution of outstanding business issues among the parties.”

The Associated Press reported that New York Attorney General Letitia James said her office was considering an appeal of the case.

Sprint Executive Chairman Marcelo Claure said that the judge’s decision “validates our view that this merger is in the best interests of the U.S. economy and American consumers.”

Federal Communications Commission Chairman Ajit Pai joined in congratulating the two carriers, calling the judge’s decision “a big win for American consumers. ”

“I’m pleased with the district court’s decision,” Pai said. “The T-Mobile-Sprint merger will help close the digital divide and secure United States leadership in 5G.” He noted that the carrier has made commitments to extend 5G coverage to 97% of the U.S. population within three years and 99% within six years, as well as commitments around extending rural coverage. “This transaction represents a unique opportunity to speed up the deployment of 5G throughout the United States, put critical mid-band spectrum to more productive use, and bring much faster mobile broadband to rural Americans. I’m gratified that the federal district court agreed with the FCC and U.S. Department of Justice that this merger is lawful and should be allowed to proceed,” Pai added.

 

ABOUT AUTHOR

Kelly Hill
Kelly Hill
Kelly reports on network test and measurement, as well as the use of big data and analytics. She first covered the wireless industry for RCR Wireless News in 2005, focusing on carriers and mobile virtual network operators, then took a few years’ hiatus and returned to RCR Wireless News to write about heterogeneous networks and network infrastructure. Kelly is an Ohio native with a masters degree in journalism from the University of California, Berkeley, where she focused on science writing and multimedia. She has written for the San Francisco Chronicle, The Oregonian and The Canton Repository. Follow her on Twitter: @khillrcr

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