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Shares of Sprint Corp. (S – Get Report) jumped on Wednesday following a report suggesting that its potential merging partner, T-Mobile US T (MUS – Get Report), is aligning buyers with assets that would help get approval from the company. Department of Justice for the $ 26 billion deal.
Dish Network Corp. (DISH – Get the Report), Altice USA Inc. (ATUS – Get the Report) and Charter Communications Inc. (CHTR – Get the Report) have been shortlisted, reported Bloomberg News on Wednesday, citing sources as saying trusted to prefer that cable assets be purchased by cable companies to increase competition between sectors. Asset sales would follow plans to get rid of Boost Mobile, a brand of prepaid wireless services, in order to obtain support from the Federal Communications Commission for the merger.
Bloomberg said companies could sell another prepaid brand to get an official DoJ nod, and eventually sell spectrum space to allow a fourth wireless network operator once the reconciliation is complete.
Sprint shares were up 2.9% on Wednesday in the mid-afternoon, for a change of hands at $ 6.77 each, while T-Mobile dropped 0.7% on the session at 74, $ 94.
Information on potential sales of assets followed the announcement yesterday that a group of ten attorneys general, all of them Democrats, had taken legal action to prevent the merger, which had taken a lot delay.
"The direct competition between Sprint and T-Mobile has led to lower prices, better service and more features for consumers," the lawsuit said. "If done, the merger will eliminate competition between Sprint and T-Mobile."
The DoJ is investigating any potential antitrust issues that may arise from this merger, even as FCC President Ajit Pai approves of it as a result of the two companies' commitment to build 5G networks across the country. , while ensuring a "robust" infrastructure. in rural areas and also improve home broadband offers for its customers.
Fusion projects have divided lawmakers in recent months, despite plans by two companies to increase spending and investment in 5G in rural telecom infrastructure, given the number of service providers without national wire would be reduced from four to three, which could potentially expand consumption. price increases.
FCC Republican Commissioner Brendan Carr said he would support Pai's decision, saying that "Americans from all over the country will see increased competition and faster 5G service creation" as part of the an agreement that "will strengthen competition in the US wireless market and provide mobile and broadband access services to communities that demand better coverage and more choice."
The Democrat Jessica Rosenworcel, however, said: "We have witnessed this type of consolidation in airlines and pharmaceutical companies.This did not work well for consumers … I have serious doubts. "
Last week, a group of US senators led by presidential candidate Elizabeth Warren asked the DoJ to reveal whether President Donald Trump, or one of his White House associates, had attempted to intervene in the ministry's investigation.
"Given the potential implications of this transaction for US consumers, we are writing to reaffirm that departmental decisions should be based on an unbiased analysis of facts and law, and should not be unduly political," said Senators. , including Warren, Amy Klobuchar and Cory Booker, wrote in a letter to the DoJ.
Sprint said the deal would give it "the scale and depth of the spectrum to provide a truly nationally consistent 5G experience", but would not provide guidance on the benefits. for 2020 as long as the DoJ's investigation would not have clarified things.
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