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Reports: Sprint-T Mobile Merger Could Be Approved This Week

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Reports: Sprint-T Mobile Merger Could Be Approved This Week

Shares of Sprint Corp (NYSE: S) gained more than 6% Wednesday morning after The Wall Street Journal reported the U.S. Justice Department could approve its pending merger with T-Mobile Us Inc (NASDAQ: TMUS).

What Happened

T-Mobile and Sprint reached a merger agreement in April of 2018 and the deal has been stuck in the regulatory process since then due to competitive concerns raised by multiple government bodies. WSJ, citing sources familiar with the matter, reported the Justice Department is okay with a merger under certain conditions.

The two companies would need to divest certain assets that would give satellite-TV operator DISH Network Corp (NASDAQ: DISH) the infrastructure to build a new wireless network. However, the merger still faces legal challenges from multiple U.S. state attorneys generals.

Why It's Important

Dish could see benefits from a merger agreement as it would acquire prepaid subscribers and wireless-spectrum licenses. The company would also receive multiyear agreements to use the wireless companies' networks while it works to build out its own dedicated network, the sources said.

Dish would become a major national competitor in the U.S. wireless business after spending the past few years acquiring wireless spectrum, WSJ wrote. As such, the Justice Department is focused on making sure Dish has the "remaining pieces" to rival the major telecom companies at the national level.

The Department of Justice could green light the Sprint-T-Mobile merger as soon as this week although the timing remains uncertain. Separately, CNBC reported a deal could be announced as early as Thursday.

Related Links:

Wells Fargo Analyst: T-Mobile-Sprint Tie-Up Could Progress Next Week

Sprint Earnings 'Better Than Feared,' But T-Mobile Merger Limbo Still A Problem

Photo credit: Chris Potter, via Wikimedia Commons

Posted-In: Department of Justice spectrum telecomM&A News Top Stories Media Best of Benzinga

 

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