Sprint, T-Mobile In $5B Deal With Dish Network To Close Mega-Merger: Report
Satellite TV player Dish Network is reportedly spending $1.5 billion on prepaid mobile businesses and $3.5 billion for spectrum in a deal that could in turn, help Sprint and T-Mobile close their $26.5 billion mega-merger.
Dish Network has agreed to take $5 billion worth of wireless assets off of Sprint and T-Mobile's hands, which could clear the way for the third and fourth largest carriers in the country to come together, according to a report from Bloomberg.
The deal with satellite TV provider Dish could give the Department of Justice (DOJ) what it needs to give its blessing for the $26.5 billion mega-merger by as soon as Thursday, Bloomberg reported.
The deal will cost Dish about $1.5 billion for prepaid mobile businesses and $3.5 billion for spectrum, according to the report, which cited people familiar with the matter.
Via the terms of the reported deal, Dish can't sell the wireless assets or hand over control of the agreement to a third party for three years. Dish will also enter into a seven-year wholesale agreement to resell T-Mobile wireless service under its own brand, and a three-year service agreement from T-Mobile for operational support as prepaid customers move to Dish.
CRN reached out to Dish Network, Sprint, and T-Mobile for comment on the latest report and did not hear back by publication time.
This is the third merger attempt by Sprint and T-Mobile. The two carriers have gone through a drawn-out negotiation process that has lasted for more than a year in trying to finally close the deal. The Federal Communications Commission said it would grant the two companies permission in May, but the Justice Department cited concerns that the mega-merger would decrease competition and raise prices on consumers. The DOJ has been pushing for the creation of a fourth carrier as a condition of the Sprint-T-Mobile deal.
In order to complete the merger, the two companies have already agreed to divest Boost Mobile. Additionally, Sprint and T-Mobile are on the hook to deploy a 5G network to cover 97 percent of the U.S. population within three years and 99 percent within six years after the merger is closed. They also promised that 90 percent of Americans would have access to mobile broadband service with at least 100 Mbps and 99 percent with access to at least 50 Mbps.
The DOJ on Sunday said it will reveal its "settlement announcement," or its terms for the merger, by this week.