Sprint/T-Mobile Merger a Step Closer to Early 2020 Completion

The FCC has conditionally approved the $26.5 billion Sprint/T-Mobile merger, paving the way for the deal to be finalized by as soon as early 2020.

The only remaining major obstacle to the merger is the lawsuit from 16 state attorneys general due to go to court next month.

The FCC formally -- and finally -- voted 3-2 in favor of the deal Tuesday. The merger was approved by the US Department of Justice (DoJ) in July.

T-Mobile and Sprint have agreed to a slew of coverage and mobile broadband speed commitments, including delivering 5G services that can reach 97% of US citizens within three years. They have also pledged to provide 90% of Americans with access to mobile service with speeds of at least 100 Mbit/s within six years. For the full list of commitments, see this press release.

But the deal still faces the lawsuit from the 16 state attorneys general. Led by California and New York, the case will begin on December 9 in New York City. The suit claims that the merger will cut access to affordable, reliable wireless service for millions of Americans. The trial is expected to last two to three weeks. Colorado dropped out of the suit late in October, after Dish -- which struck a $5 billion agreement with the DoJ to acquire spectrum, customers and an MVNO arrangement from the combination of Sprint and T-Mobile -- promised to keep its headquarters in the state and promised that Colorado would be one of the first states to host Dish's promised 5G network.

The formal FCC approval comes after Sprint's disappointing financial update -- on Monday it reported a net loss of $274 million for its fiscal second quarter.

Analysts at LightShed Partners had even suggested T-Mobile's parent company, Germany's Deutsche Telekom, should renegotiate the $26.5 billion merger agreement with Sprint since it passed its outside date deadline on Friday. "We think Deutsche Telekom should use that flexibility to renegotiate the terms of the deal, given the erosion at Sprint and the rising cost of the transaction," wrote the analyst team, which included Walt Piecyk, in a note on Monday.

So far, both Sprint and T-Mobile have expressed confidence that the merger will close early in calendar year 2020.

Related posts:

— Dan Jones, Mobile Editor, Light Reading

COMMENTS Add Comment
Be the first to post a comment regarding this story.
Sign In