The pending merger between Sprint and T-Mobile has now been approved after a US court denied the claims in a lawsuit brought by several states to halt the deal. That’s according to recent reports citing a 170-page court document outlining the ruling.
The primary concern brought in the case was the argument that the merger would stifle competition. The states also argued that costs to consumers would rise as a result. However, Sprint and T-Mobile have made a number of concessions since the merger was first entertained in 2018. Not least among those is the promised creation of thousands of jobs.
The two carriers have also agreed to sell out a significant number of assets previously owned by Sprint. In particular, those are assets associated with MVNO carrier Boost Mobile. That’s in addition to a promised 3-year freeze on service plan rates so that consumers won’t be paying more over the next several years.
The US Federal District Court — in this case, the Southern District of New York — ultimately agreed that those concerns were valid. The concessions made by the carriers are cited by the court as the deciding factor in getting the T-Mobile and Sprint merger approved.
The Sprint, T-Mobile merger was finalized last year but paused
The $26-billion merger between the two carriers in question was actually approved by the appropriate government bodies last year. The Department of Justice was the final agency to sign off on the deal back in July. But the deal faced stiff opposition from the start, including a lawsuit brought by no fewer than 13 State Attorney’s General.
In the interim, several states dropped out of the suit, including Mississippi and later Colorado. That latter decision was reached after Dish Network agreed to locate its wireless headquarters in Colorado. Dish Network is set to take a wide variety of assets from Sprint as part of the T-Mobile merger. That places it in a position to plausibly become the nation’s fourth-largest wireless provider.
As part of the Dish deal with Colorado, the company also agreed to create 2,000 full-time jobs within the state and to keep its headquarters there for at least seven years. Moreover, Dish Network will be launching its 5G service with Colorado among the first 10 states to be included. That’s on top of T-Mobile’s promise to bring 100Mbps 5G to at least 68 percent of the Colorado population. It will have a three-year period to accomplish that.
After those states dropped, the case continued with California, New York, Connecticut, Hawaii, Illinois, Maryland, Michigan, Minnesota, Oregon, Wisconsin, and the Commonwealths of Massachusetts, Pennsylvania, Virginia, as well as the District of Columbia still in opposition.
T-Mobile and Sprint had both agreed to hold off on merger plans until after the lawsuit was finalized.
Where do the carriers go from here?
Sprint and T-Mobile estimate that the process of merging into the “New” T-Mobile could be finalized as early as the first of April. But the case may still be far from over. The remaining Attorney’s General could still take the case through appeals. Those appeals could potentially go as far as the US Supreme Court.
If the states choose to appeal, the merger between the carriers would undoubtedly drag on for some time. That could put finalization and the end of the process as far out as 2021.