The Justice Department announced on Friday that it has reached a deal of more than $ 26 billion mergers between T-Mobile and Sprint.
Following the announcement, shares in T-Mobile and Sprint hit new highlights at all time at $ 83.34 and $ 7.94 respectively. Shares of Dish Network climbed as much as 2.5%.
As part of the deal, Sprint will dispose of prepaid phone companies from Boost Mobile, Virgin Mobile and Sprint. Sprint and T-Mobile will dispose of some of the wireless spectrum for dishwashing and make at least 20,000 cell sites and hundreds of stores available to the company. Dish will also be able to access T-Mobil's network for seven years.
Makan Delrahim, head of DOJ's antitrust division, said that without these remedies, the merger would "seriously damage the competition."
"The Americans' access to fast, reliable and affordable wireless connectivity is critical to our economy and to any American consumer and to their way of life," Delrahim said at a press conference announcing the deal.
Delrahim added that the deal establishes Dish as a "disturbing coercion wirelessly."
T-Mobile and Sprint said they expect regulators to approve the merger in the third quarter and the deal will end in the second half of this year.
Separately, Dish announced that it entered into an agreement with the Federal Communications Commission to establish a 5G broadband network covering 70% of the US population by June 2023. If it fails to comply with that deadline, it will pay the US Treasury as much as $ $ 2.2 billion.
The Advocates General of Nebraska, Kansas, Ohio, Oklahoma and South Dakota have signed the agreement. However, T-Mobile and Sprint still face an ongoing lawsuit from 1
Led by New York and California, the case is seeking to block the agreement on a restrictive basis.
merger cannot be terminated until after the case is resolved. The trial is scheduled to begin October 7, but this date can be pushed back to December 9, given the structural changes in the merger that were announced today.
A spokesman for California's Attorney General Xavier Becerra said, "We review the announced settlement, but our bottom line remains the same: protect consumers and competition."
New York State Attorney Letitia James said in a statement: "We have Serious concerns that we are compiling this new fourth mobile player, with the government choosing winners and losers, will not address the mergers' damage to consumers, workers and innovation. "
In an interview with CNBC's David Faber, Sprint chairman Marcelo Claure maintained that Dish will be a viable competitor when the deal is approved.  "You can look at the level of concessions we have made in providing dishwashing access to the new network … disposing of our 800 MHz spectrum, giving them access to some of our stores, some of our towers, and buy our incredible brands, Boost and Virgin, "Claure said. "I think Dish will be set to be a viable competitor."
The blockbuster bond, announced more than a year ago, consolidates the nation's third and fourth largest wireless vendors and creates a combined company with a business value of about $ 160 billion.
It puts an end to many years of negotiations between the companies. Sprint Parents SoftBank tried and failed to merge with T-Mobile in 2014 due to regulatory concerns, then deal negotiations re-entered in 2017 after SoftBank expressed doubts about surrendering control of Sprint. The DOJ decision is expected to come out on Thursday, but was delayed when DOJ spoke to states and encouraged them to support the deal, according to The Wall Street Journal.
Claure said he hopes the state lawyers who brought the lawsuit will understand the potential value that might come from the deal.
"If I'm a public prosecutor, I'll look at how this is good for my state," Claure said. "I really hope this does not turn into a political struggle … I have a lot of faith in the public prosecutor's general that once they have understood the consent agreement and the level of competition that will exist in the market, they will hopefully settle down and be able to come to an agreement with us. "
The deal gained relatively quick approval from the Federal Communications Commission in May after T-Mobile and Sprint agreed to invest in rural broadband development and build a new 5G infrastructure. .