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T-Mobile/Sprint merger faces big test as nine states sue to block it
Nine states and the District of Columbia today filed a lawsuit against T-Mobile and Sprint in an attempt to stop the wireless carriers from merging.
New York Attorney General Letitia James and California AG Xavier Becerra are leading the way, with co-plaintiffs from Colorado, Connecticut, the District of Columbia, Maryland, Michigan, Mississippi, Virginia, and Wisconsin.
"When it comes to corporate power, bigger isn't always better," James said in an announcement of the lawsuit. "The T-Mobile and Sprint merger would not only cause irreparable harm to mobile subscribers nationwide by cutting access to affordable, reliable wireless service for millions of Americans, but would particularly affect lower-income and minority communities here in New York and in urban areas across the country. That's why we are going to court to stop this merger and protect our consumers, because this is exactly the sort of consumer-harming, job-killing megamerger our antitrust laws were designed to prevent."
Becerra argued that the "merger would hurt the most vulnerable Californians and result in a compressed market with fewer choices and higher prices."
The AGs filed their complaint in US District Court for the Southern District of New York.
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Judge approves $26 billion merger of T-Mobile and Sprint:
Shares of Sprint soared Tuesday after a U.S. District judge ruled in favor of its $26 billion deal to merge with T-Mobile.
The stock was up 75% Tuesday morning. It had risen after hours Monday after The Wall Street Journal reported the judge was expected to rule in favor of the deal. Shares of T-Mobile were up 10%.
The ruling clears one of the final hurdles for the deal, which still can't close until the California Public Utilities Commission approves the transaction. Tuesday's ruling also culminates a years-long courtship between Sprint and T-Mobile, which have made multiple attempts over the years to merge, only to abandon their plans fearing regulatory scrutiny.
Attorneys general from New York, California, Connecticut, Hawaii, Illinois, Maryland, Michigan, Minnesota, Oregon, Wisconsin, Massachusetts, Pennsylvania, Virginia and D.C. originally brought the lawsuit to block the deal following approval from the Justice Department of Federal Communications Commission. The states had argued that combining the No. 3 and No. 4 U.S. carriers would limit competition and result in higher prices for consumers. The companies had argued their merger would help them compete against top players AT&T and Verizon and advance efforts to build a nationwide 5G network.
In his decision filed Tuesday, Judge Victor Marrero wrote, "The resulting stalemate leaves the Court lacking sufficiently impartial and objective ground on which to rely in basing a sound forecast of the likely competitive effects of a merger."
(Score: 2, Insightful) by Anonymous Coward on Wednesday June 12 2019, @11:54AM (2 children)
We let a bunch of companies merge, creating the giant AT&T.
We let a bunch of companies merge, creating the giant Verizon.
Now suddenly we care about a couple piddly little pipsqueak companies merging?
I'm all about breaking up monopolies and preventing them from forming, but this is silly. It has the smell of politicians wanting their cut. The nicest interpretation is that the politics of blocking mergers has seen change, but then we really need to go back to break up AT&T and Verizon.
(Score: 5, Insightful) by jmorris on Wednesday June 12 2019, @03:27PM (1 child)
Be more cynical. Now AT&T and Verizon are big enough to prevent a #3 from arising. So they prevent the merger and the marginal and struggling #3 and #4 both go bankrupt instead of becoming big enough to compete. Then AT&T and Verizon buy the corpses and get even bigger.
(Score: 2) by bob_super on Wednesday June 12 2019, @05:36PM
We the people lease those guys some of our precious spectrum, and should reserve the right to pull out some/all spectrum leases from any provider(s), in order to allow equitable competition between 4 operators, as illustrated by prices similar to other advanced countries (South Korea, Japan, EU...).
(totally holding my breath, go Pai, go!)
(Score: 0) by Anonymous Coward on Wednesday June 12 2019, @11:59AM
Keep zee Germans out, coz they're coming only after you get proper fucked [youtu.be].