NEW YORK — A federal judge has approved T-Mobile's $26.5 billion takeover of Overland Park-based Sprint, removing a major obstacle in wireless shakeup.
After the deal closes, the number of major U.S. wireless companies would shrink from four to three.
T-Mobile, based in Bellevue, Washington, says the deal would benefit consumers as it becomes a fiercer competitor to the larger companies Verizon and AT&T. But a group of state attorneys general tried to block the deal, arguing that having one fewer phone company would cost Americans billions of dollars in higher cellphone bills.
Judge Victor Marrero rejected those claims, saying that T-Mobile executives were credible at trial in promising to continue competing aggressively with Verizon and AT&T.
New York Attorney General Letitia James said Tuesday that an appeal is possible.
T-Mobile said there will be several benefits to the acquisition of Sprint, including enhanced 5G, better service, lower prices, new in-home internet and job creation.
Though the deal still needs a few more approvals, T-Mobile expects to close it as early as April 1.
T-Mobile and Sprint released a joint statement following the court decision, hailing it as a "huge victory" and saying that it will allow the two companies to focus on the final steps of the merger.
“Judge Marrero’s decision validates our view that this merger is in the best interests of the U.S. economy and American consumers,” said Sprint Executive Chairman Marcelo Claure said in a news release. “Today brings us a big step closer to creating a combined company that will provide nationwide 5G, lower costs and a high-performing network that will invigorate competition to the benefit of all mobile wireless and in-home broadband consumers. With the support of federal regulators and now this Court, we will focus on quickly completing the few remaining necessary steps to close this transaction."
T-Mobile Chief Executive Officer John Legere said the merger will change the face of wireless.
"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," Legere said in the release. "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!”
The companies said the merger still "remains subject to certain closing conditions," which includes additional court proceedings and resolution of outstanding business issues.
Kansas Attorney General Derek Schmidt said the court's decision on Tuesday was "welcome news for Kansas," where T-Mobile has said it will continue to have a major presence.
"We intend to hold the merged company to its promises of investment in its Kansas network and of maintaining substantial employment at what will become the combined company’s ‘second headquarters’ in Overland Park," Schmidt said in a news release.
Overland Park Mayor Carl Gerlach said the merger of the two companies will bring "greater strength" to the Overland Park area.
"I’m confident that Overland Park and the Kansas City region can meet the demand for an innovative and knowledgeable workforce of today and into the future," the mayor said in a statement.
Shares of Sprint soared 70% on Tuesday morning after the judge's decision, according to CNBC.
T-Mobile and Sprint announced plans to merge in April 2018. Last summer, the U.S. Department of Justice granted its approval to the merger, with certain conditions. The Federal Communications Commission also voted to approve the merger while outlining conditions for the deal.
