The overseas parent companies of T-Mobile US Inc. (TMUS) and Sprint Corp. (S) finally agreed how to divide ownership of their companies in a merger. But figuring out how to divide the baby, which unfolded over sporadic talks since last year, is the easy part.
The horizontal merger that will eliminate one of four wireless carriers will be a tough sell in Washington.
After all, DOJ antitrust chief Makan Delrahim has opposed AT&T Inc.'s (T) purchase of Time Warner Inc. (TWX) on the argument that it will drive up consumers' cable bills by less than 50 cents per month.
In favor of Sprint and T-Mobile, they do not own President Trump's least favorite cable news network, as Time Warner does. But there are other considerations that have as much to do with politics as with antitrust issues.
Legere and Claire make three propositions to regulators. They will continue to compete aggressively against AT&T Inc. and Verizon Communications Inc. (VZ) , and will drive prices lower. Second, they will invest more in 5G wireless technology, ensuring that the U.S. maintains its lead against China and South Korea. Third, they will create jobs.
Legere vowed to "double down even more" in competition against the "duopoly" of AT&T and Verizon, or "dumb and dumber," as the T-Mobile CEO refers to the leading U.S. wireless carriers. Prices will go down, Legere predicted.
Editor's note: The full version of this article was published by The Deal, a sister publication of TheStreet that offers sophisticated insight and analysis on all types of deals, from inception to integration. Click here for a free trial.