The Wall Street Journal reports that Sprint is dropping their plans to buy T-Mobile US. WSJ says Sprint and its parent firm, SoftBank, believe it would be too difficult to gain regulatory approval for the deal. Sprint plans to make an announcement today.
Sprint Corp. is ending its pursuit of T-Mobile US, according to people familiar with the matter. The company and its parent, SoftBank Corp. decided it simply would be too difficult to win approval from regulators, the people said.
We first reported the news that Sprint was working on a deal to grab T-Mobile US back in December 2013. The deal would have been worth over $20 billion.
January 2014 saw a meeting between the U.S. Justice Department and Sprint board members, where the deal was discussed, and the Justice Department express concerns about the proposed merger. Antitrust authorities have expressed that their ideal situation is to have four carriers available to consumers in order to maintain a competitive national market.
Bloomberg reports that Sprint has also announced a new CEO today, naming Marcelo Claure, the founder of mobile-phone distributor Brightstar Corp., as its new chief executive officer. Former CEO Dan Hesse has been shown the door following the failed merger deal.
This marks the second time a T-Mobile grab has failed, as AT&T previously attempted to acquire T-Mobile, but the deal fell through when it was blocked by the U.S. Federal Communications Commission and the Department of Justice.