T-Mobile US Inc and Sprint Corp won a federal court fight as a judge ruled on Tuesday that their $26 billion merger was legal and should be allowed.
In his ruling, Judge Victor Marrero disagreed with a group of state attorneys general who had argued that a merger of the No. 3 and No. 4 U.S. wireless companies should be prohibited because it would lead to higher prices for consumers.
The Court stated that, “T-Mobile has redefined itself over the past decade as a maverick that has spurred the two largest players in its industry to make numerous pro-consumer changes. The proposed merger would allow the merged company to continue T-Mobile’s undeniably successful business strategy for the foreseeable future.”
“Today was a huge victory for this merger … and now we are FINALLY able to focus on the last steps to get this merger done! We want to thank the Court for its thorough review of the facts we presented in our case. We’ve said it all along: the New T-Mobile will be a supercharged Un-carrier that is great for consumers and great for competition. The broad and deep 5G network that only our combined companies will be able to bring to life is going to change wireless … and beyond. Look out Dumb and Dumber and Big Cable – we are coming for you … and you haven’t seen anything yet!” said John Legere, Chief Executive Officer of T-Mobile.
Although the merger was approved by the Federal Communications Commission and the Department of Justice, a group of state attorneys general filed a lawsuit against the two telecoms, claiming it would lead to less competition and higher cell phone bills for customers. The lawsuit was filed by 13 states and the District of Columbia.
The T-Mobile and Sprint combination remains subject to certain closing conditions, including possible additional court proceedings, and satisfactory resolution of outstanding business issues among the parties.
As part of its agreement with the DOJ, Sprint said it would sell its prepaid wireless business to Dish Network, so that it could build a fourth network for cell phone service.
T-Mobile promised that customers would either maintain their current plans, or receive better ones, for the first three years following the deal—and plans to give free wireless services to first responders and free internet to some low-income households with children.
Following the merger, Sprint customers will be absorbed by T-Mobile, therefore becoming T-Mobile customers. And customers of Sprint’s prepaid services will become Dish Network customers.
T-Mobile will rival AT&T and Verizon, America’s other top telecommunications companies.