WASHINGTON - T-Mobile US Inc’s $26 billion acquisition of rival Sprint Corp won the support of the head of the Federal Communications Commission on Monday, in a big step toward the deal’s approval.
Sprint shares initially surged 23.2% while T-Mobile shares rose 5.1%, but both pared gains to a rise of 14% and 2.8% respectively after a report from Bloomberg News said the Department of Justice, which also has to OK the deal, was leaning against approval. Bloomberg said the department was concerned the proposed remedies did not resolve antitrust concerns.
“The FCC’s seeming abdication makes it even more important for the Department of Justice to step up to the plate to block this merger,” the Democratic senator said in a statement. The FCC move boded well for the Justice Department to also approve the deal, Citi analysts said in a note. The sale will include the brand name, any active accounts and dedicated Boost assets and staff but no wireless spectrum. The new Boost could buy network access from T-Mobile for at least six years.“I don’t understand how the mere spinning off of one of three prepaid services would satisfy , given all the evidence in the record that post-paid prices will go up,” said Gigi Sohn, who held a senior FCC position during the Obama administration. “I just think this is very weak tea.
They broke up ma bell for being too big - now they are creating an even bigger giant. Consumers are the ones that will suffer.
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