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Justice Dept. approves $26B merger of Sprint, T-Mobile

By Nicholas Sakelaris
The Justice Department approval puts the $26 billion merger one step closer to fruition. File Photo by Roger L. Wollenberg/UPI
The Justice Department approval puts the $26 billion merger one step closer to fruition. File Photo by Roger L. Wollenberg/UPI | License Photo

July 26 (UPI) -- The U.S. Department of Justice said Friday it has approved the long-planned $26 billion merger of Sprint and T-Mobile, two of the four major cellular carriers in the United States.

Friday's approval came five years after the two carriers first explored a merger. After the plan was announced, attorneys general in Nebraska, Kansas, Ohio, Oklahoma and South Dakota all opposed the transaction fearing it would lead to less competition and higher rates. They were part of Friday's settlement.

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The companies, however, still face a separate lawsuit from 13 other states and the District of Columbia. The merger cannot be finalized until that lawsuit is settled.

Justice Department approval requires Sprint to divest Boost Mobile, Virgin Mobile and Sprint's prepaid businesses. Also, Sprint and T-Mobile must divest some of the wireless spectrum to Dish Network and make at least 20,000 cell sites and hundreds of retail stores available. As part of the settlement, Dish will be able to access T-Mobile's network for seven years as DIsh builds out its own 5G network.

"With this merger and accompanying divestiture, we are expanding output significantly by ensuring that large amounts of currently unused or underused spectrum are available to American consumers in the form of high-quality 5G networks," said Makan Delrahim, head of the department's antitrust division.

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The concessions aim to protect consumers by establishing Dish as a "disruptive force in wireless."

"Americans' access to fast, reliable and affordable wireless connectivity is critically important to our economy and to every American consumer and to their way of life," Delrahim added.

Sprint Chairman Marcelo Claure said he wants the attorneys general to look at the deal's value.

"I"m really hoping this doesn't turn into [a] political fight," Claure said. "I have a lot of faith in the state attorneys general that once they understand the consent decree and the level of competition that's going to exist in the market, that hopefully they will sit down and be able to reach an agreement with us."

The Federal Communications Commission approved the deal in May after they agreed to invest in rural broadband.

Sprint and T-Mobile were founded about 30 years ago and have grown into two of the largest U.S. carriers, along with AT&T and Verizon.

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