The Department of Justice announced Friday that it has reached an agreement on the merger of T-Mobile and Sprint worth over $ 26 billion.
Following the announcement, T-Mobile and Sprint shares reached new all-time highs of $ 83.34 and $ 7.94, respectively. The shares in Dish Network even increased by 2.5%.
Under the agreement, Sprint will divest its prepaid phone businesses Boost Mobile, Virgin Mobile and Sprint. Sprint and T-Mobile will divest part of their mobile spectrum to Dish and provide the company with at least 20,000 mobile sites and hundreds of retail outlets. Dish will also be able to access the T-Mobile network for seven years.
Makan Delrahim, head of the cartel department of the DOJ, said without these remedies, the merger would "seriously damage" the competition.
"American access to." Fast, reliable and affordable wireless connectivity is critical to our economy and to every American consumer and lifestyle, "said Delrahim at a press conference announcing the agreement.
"Disruptive" Introduces Force in Wireless. "
T-Mobile and Sprint expect supervisors to approve the third-quarter merger and conclusion of the agreement in the second half of the year.
Dish separately announced that they have made an agreement with The Federal Communications Commission will set up a 5G broadband network for 70% of the US population by June 2023. If this deadline is not met, it will pay the US Treasury $ 2.2 billion.
Sta The Attorney Generals of Nebraska, Kansas, Ohio, Oklahoma and South Dakota have signed the agreement. However, T-Mobile and Sprint are still facing charges from 1
The case, cited by New York and California, seeks to block the deal for anticompetitive reasons.
The merger can not be completed until this case has been resolved. The process is set to start on 7 October, but could be postponed to 9 December on the basis of the structural changes to the merger announced today.
A spokesman for California Attorney General Xavier Becerra said: "We are reviewing the announced deal, but our conclusion remains the same: consumer protection and competition."
Letitia James, Attorney General of New York, said in a statement: " We have serious concerns about cobbling this new fourth mobile player with the government. The selection of winners and losers will not address the damage to the consumer, worker, and innovation merger. "
In an interview with David Faber of CNBC, he argues Sprint chairman Marcelo Claure believes that Dish will be a viable competitor once the contract is approved.
"You can see from the amount of concessions we made to give Dish access to the new network … to sell our 800MHz spectrum, giving them access to some of our stores, some of our towers and our incredible brands to buy "Boost and Virgin," said Claure. "I think Dish will be a viable competitor."
The blockbuster cooperation announced more than a year ago consolidates the country's third and fourth largest mobile service providers creates a combined company with an enterprise value of approximately $ 160 billion.
Ending Years of Business Negotiations Sprint, the parent company of Softbank, attempted to merge with T-Mobile in 2014 and failed due to regulatory concerns in 2014. In 2017, negotiations then failed again after SoftBank expressed doubts about having control over Spri to give up.
DOJ Decision Expected The DOJ was out of office on Thursday, according to the Wall Street Journal, but was late in speaking with the states and encouraging them to support the deal.
Claure hopes that the prosecutors who filed the lawsuit understand the potential value that could result from the deal.
"If I'm a prosecutor, I'll check how good that is for my state," Claure said. "I really hope that no political struggle [a] develops from this … I have great confidence in the Attorney Generals who, once they have understood the approval decree, and the degree of competition that will prevail in the EU, that market hopefully they can sit down and reach an agreement with us. "
The deal received a relatively quick approval from the Federal Communications Commission in May after T-Mobile and Sprint agreed to develop and expand the rural broadband network invest new 5G infrastructure.