WASHINGTON (The Blaze/AP) -- The Justice Department is blocking AT&T's $39 billion deal to buy T-Mobile USA, saying the acquisition of the No. 4 wireless carrier in the country by No. 2 AT&T would reduce competition and raise prices. Bloomberg has more:
The Justice Department complaint was filed today in federal court in Washington. The U.S. is seeking a declaration that Dallas-based AT&T’s takeover of T-Mobile, a unit of Deutsche Telekom AG (DTE), would violate U.S. antitrust law and a court order blocking any arrangement implementing the deal.
“AT&T’s elimination of T-Mobile as an independent, low- priced rival would remove a significant competitive force from the market,” the U.S. said in its filing.
The deal has faced tough opposition from consumer groups and No. 3 carrier Sprint since it was announced in March.
AT&T could challenge the Justice Department's action in court.
A failure of the deal puts T-Mobile in a difficult position. It's struggling to compete with the larger carriers, and owner Deutsche Telekom AG has said it's not willing to invest more in the venture.
However, AT&T has promised T-Mobile $3 billion in cash if the deal doesn't go through, plus spectrum rights and agreements that could be worth billions more.