U.S. antitrust obstacles seen for T-Mobile, Sprint deal

It claims that SoftBank, the Japanese company that acquired a majority stake in Sprint back in 2013, may be willing to give up its control of the carrier to Deutsche Telekom, the owners of T-Mobile US, in an effort to merge both carriers. Verizon disturbed the hornet's nest when it unveiled its Verizon Unlimited plan, which prompted direct responses from T-Mobile, Sprint and AT&T (in that order). Two years ago, SoftBank offered Deutsche Telekom a minority stake in an acquisition deal estimated in the billions, but walked away in the face of opposition from U.S. antitrust regulators at the FCC and U.S. Department of Justice. Now were hearing about another shakeup that could be coming down the line - a merger between Sprint and T-Mobile. That deal, however, was batted down once US antitrust regulators got a whiff of what the combined company would do to competition.

Sprint and T-Mobile will likely face the same regulatory scrutiny if a potential purchase deal is reached between the two.

The last time that merger talks were underway, SoftBank was the pursuer, looking to acquire T-Mobile. Now, however, it is T-Mobile US parent Deutsche Telekom that is in the stronger position.


T-Mobile has been gaining subscriber and revenue share vs. AT&T (T) and Verizon Communications (VZ) for three years with its "Uncarrier"-branded marketing, while Sprint has also showed signs of rebounding". And forthcoming fifth-generation wireless upgrades, or 5G, are expected to cost billions of dollars.

SoftBank CEO Masayoshi Son met with Trump in December and pledged to invest $50 billion in USA businesses, along with a plan to create 50,000 jobs.

Sprint and T-Mobile have both had trouble competing with Verizon and AT&T, and that's largely because Verizon and AT&T are twice the size of both carriers. "Maybe a simple merger, we may be dealing with T-Mobile, we may be dealing with totally different people, different company", SoftBank Chief Executive Masayoshi Son told analysts on the company's latest quarterly earnings call earlier this month.

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