T-Mobile, Sprint defend against merger doubt - Mobile World Live

T-Mobile, Sprint defend against merger doubt

17 APR 2019

T-Mobile US CEO John Legere and Sprint chairman Marcelo Claure hit back at a report by The Wall Street Journal (WSJ) stating resistance from the US Department of Justice (DoJ) has cast doubt on the operators’ proposed $26 billion merger.

Legere and Claure (pictured left and right, respectively) took to Twitter to respond to the report, which cited sources as stating the DoJ’s antitrust enforcement staff have told the companies the deal is unlikely to be approved as it is currently structured.

The T-Mobile chief said the premise of the story “is simply untrue”, and it had no further comment to make out of respect for the process: Claure said the article is not accurate and discussions with regulators are ongoing.

WSJ reported the DoJ’s monopoly unit is currently reviewing the deal’s potential impact on competition, with staff laying out concerns earlier this month. In particular, it questioned the companies’ claims the combination will produce “important efficiencies” for the merged company.

A meeting is set for later this month between senior antitrust officials and advisers to the companies.

Several weeks away
The deal cleared a major hurdle in December 2018 when it received national security clearance, but still needs approval from the DoJ and Federal Communications Commission.

Earlier this month, analyst company MoffettNathanson warned state attorneys general could take legal action to block the deal, increasing the chances of a DoJ rejection.

T-Mobile and Sprint could yet offer concessions including asset sales to allay competition fears, but they remain confident of closing the deal by the end of July.

Sources told WSJ the complexity of the review process means a final decision is likely to be several weeks away.

The companies unveiled their merger plans in April 2018: the deal would shrink the US market from four major players to three.

In their attempts to gain approval, the operators have pushed the tie-up’s potential to advance 5G, as well as creating a stronger third player in the mobile market to boost innovation and competition.

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Kavit Majithia

Kavit joined Mobile World Live in May 2015 as Content Editor. He started his journalism career at the Press Association before joining Euromoney’s graduate scheme in April 2010. Read More >>

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