T-Mobile and Sprint’s $26 Billion Merger Approved by U.S. District Court
A federal judge approved the merger of T-Mobile and Sprint this morning in a U.S. district court in New York, moving the mobile carriers one critical step closer to sealing the deal.
Following this stamp of approval on the $26 billion deal, the companies are still awaiting a vote from the California Public Utilities Commission, which could prove to be the merger’s last hurdle.
While T-Mobile and Sprint struck the deal nearly two years ago, talks between the two companies had been on and off for years prior. Judge Victor Marrero’s decision today dismissed complaints brought by attorneys general from 13 states and the District of Columbia, who argued that merging the nation’s third and fourth largest carriers would limit competition and lead to higher prices for customers. The companies said that they needed to merge in order to successfully compete with the top two telecoms: AT&T and Verizon.
In approving the merger, the court’s ruling said that T-Mobile “has spurred the two largest players in its industry to make numerous pro-consumer changes,” and that combining with Sprint “would allow the merged company to continue T-Mobile’s undeniably successful business strategy for the foreseeable future.”
Calling the ruling a “huge victory,” T-Mobile CEO John Legere referenced competitor brands in a statement, saying, “Look out, Dumb and Dumber and Big Cable—we are coming for you… and you haven’t seen anything yet!”
Sprint executive chairman Marcelo Claure added that the decision “validates our view that this merger is in the best interests of the U.S. economy and American consumers.”
Following the court’s announcement, Sprint stock shot up by more than 70% while T-Mobile gained a 10% bump, according to MarketWatch.
New York Attorney General Letitia James, who led the legal challenge against T-Mobile’s takeover of Sprint, left open the possibility for an appeal in a statement released after the judge’s decision was announced.
“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,” James said. “We disagree with this decision wholeheartedly, and will continue to fight the kind of consumer-harming megamergers our antitrust laws were designed to prevent.”
California’s utility entity has until July to approve the transaction, but Legere said he hopes to have the deal finalized by the end of April.
