Is Sprint's T-Mobile Acquisition Dead Before It Begins?

Well, that didn't take very long.

While we knew its chances certainly weren't a sure thing, many believed the odds of Sprint's (NYSE: S  ) reportedly looming bid for smaller telecom rival T-Mobile (NYSE: TMUS  ) would at least see the light of day.

However, it sounds like this deal has already met some serious opposition from U.S. regulators that could threaten to derail Sprint's T-Mobile deal before it begins.

Source: T-Mobile.

Sprint's deal gets shot down
Since word of Sprint's intension to acquire T-Mobile originally surfaced last week, a number of sources close to regulators in Washington have reportedly claimed that the deal is unlikely to gain the regulatory approval needed.

As we've seen with past telecom megamergers like AT&T's own attempted purchase of T-Mobile, the top telecom regulatory brass are clearly hesitant to concentrate too much power in only a few telecom giants. And although Sprint with T-Mobile would still be only the third largest U.S. telecom player, decreasing the number of potential choices for consumers has regulators on guard.

However, it appears that Sprint, and its parent company, Japanese telecom power SoftBank, plan to press on with their acquisition campaign for the time being. And in the following video, tech and telecom specialist Andrew Tonner discusses some of the new regulatory hurdles Sprint must overcome if it ever hopes to nab T-Mobile.

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  • Report this Comment On May 10, 2014, at 9:52 PM, larrysd1 wrote:

    I think fool has there own agenda when it comes to Sprint...

  • Report this Comment On May 11, 2014, at 1:13 PM, BigAll wrote:

    The "regulators" are posturing. They know what everyone else knows. Eventually there will only be three. The question is how and when not "if" it will happen. They can allow a merger in the short term, or years from now one of these two will go broke.

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Andrew Tonner

Andrew Tonner is a tech specialist for The Motley Fool. He is a graduate of The University of Arizona with a degree in Finance.

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