clock menu more-arrow no yes mobile

Filed under:

US Justice Department asks FCC to defer Sprint, SoftBank merger

New, 42 comments
Sprint store (STOCK)
Sprint store (STOCK)

The US Justice Department has requested that the FCC hold off on approving a planned merger between Sprint and SoftBank, according to Bloomberg, a move that would grant the government more time to review the proposal. In a filing posted today, the DOJ says it's "currently reviewing this matter for any national security, law enforcement, and public safety issues." It's doing so with the help of the FBI and Department of Homeland Security, and is asking the FCC to give the agencies time to complete their assessment before moving forward. It's important to note that the Justice Department's request isn't atypical considering the circumstances; such reviews are mandatory when a major US business moves to foreign ownership.

The deal was first announced in October, with Sprint and Japanese carrier SoftBank publicly stating they hoped to have it approved by mid-2013. A deferment from the FCC could significantly hold up that process and push off any closure of the $20.8 billion acquisition, however.

Though it hasn't voiced outright opposition to such a merger, rival AT&T issued a statement highlighting the fact that the buyout would grant "Japan's largest wireless companies control of significantly more U.S. wireless spectrum than any other company" — a statistic it urged regulators to take into consideration during the review process. Dish today announced that it will not formally oppose the deal, which would give SoftBank 70 percent ownership of Sprint Nextel. Approval of the merger is important to Sprint's future plans; as just one example, part of the acquisition will see $8 billion in equity financing go toward the carrier's 4G LTE buildout in the US.