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T-Mobile, Sprint, Eager to Challenge AT&T, Verizon, Get Big Approval for ‘Consumer-Harming’ Merger

Business Celebration

T-Mobile executives are cheering a judge’s favorable ruling on its $26 billion merger with Sprint.

U.S. District Court Judge Victor Marrero dismissed a lawsuit from 14 state attorneys general in a move that represents the last federal regulatory hurdle for the two companies. The merger awaits approval from the California Public Utilities Commission, but T-Mobile executives are celebrating the latest win. T-Mobile president and chief operating officer Mike Sievert said the merger may close as soon as April 1.

Sievert, Mike_T-Mobile

T-Mobile’s Mike Sievert

“Now we can get to work finishing what we set out to do — bringing a new standard for value, speed, coverage, quality and customer service to U.S. consumers everywhere and truly changing wireless for good,” said Sievert, who will replace CEO John Legere on May 1.

A divestiture plan spurred by the U.S. Justice Department stipulates that Dish Network will pay for Sprint spectrum and T-Mobile network access in order to become the nation’s fourth wireless carrier in place of Sprint.

The now-dismissed lawsuit argued that T-Mobile would pursue “anticompetitive practices,” that Sprint would function as a viable wireless competitor if the merger did not go through and that Dish Network could not fill the gap left by Sprint. Judge Marrero disagreed on all three counts.

Marrero wrote that while Sprint’s recent “cost-cutting campaign” succeeded in attracting new customers with low prices, the carrier has struggled to keep those subscribers.

“Unlike T-Mobile, Sprint’s trajectory over the past decade has been largely downward, as it has lost subscribers and has been eclipsed by T-Mobile as the third-largest MNO,” Marrero wrote in his ruling. “Due in part to several questionable technological choices, Sprint’s network is poorer in quality than those of its competitors and its brand image is correspondingly poor.”

Marrero lauded Dish, on the other hand, as “financially stable.”

Keep up with the latest channel-impacting mergers and acquisitions in our M&A roundup.

“Over the past eight years, Dish has amassed a large portfolio of spectrum, roughly equivalent in size to that of Verizon, through a series of private transactions and purchases at FCC auctions,” Marrero said.

T-Mobile John Legere celebrated the ruling in a series of tweets Tuesday.

New York State Attorney General Letitia James blasted the ruling in a statement. She characterized the deal as a “consumer-harming” megamerger.

“Today’s decision marks a loss for every American who relies on their cellphone for work, to care for a family member, and to communicate with friends. From the start, this merger has been about massive corporate profits over all else, and despite the companies’ false claims, this deal will endanger wireless subscribers where it hurts most: their wallets. There is no doubt that reducing the mobile market from four to three will be bad for consumers, bad for workers, and bad for innovation, which is why the states stepped up and led this lawsuit,” James said.

James led the lawsuit with California Attorney General Xavier Becerra. Fourteen attorneys general filed the suit June 11, 2019.

“Our fight to oppose this merger sends a strong message: Even in the face of …

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