T-Mobile US Inc. and Sprint Corp. believe that their planned merger will be easier for the American authorities to proceed. That’s what the companies think now that their foreign owners have offered to stop using Huawei’s technology altogether. It shows how far Washington goes to exclude the Chinese company.
That reports press agency Reuters today based on sources familiar with the deal. T-Mobile US and Sprint Corp want to merge for 26 billion dollars in order to be able to compete better in the US market. They do not use Huawei technology, but their owners, Deutsche Telekom AG and SoftBank Group, do.
No more Huawei
Sources familiar with the deal report to Reuters that the U.S. government has been pushing Deutsche Telekom to stop using Huawei’s network equipment. The impression has been created that the deal would only take place if the company made a commitment to do so.
That worked, because earlier this week, both the German Deutsche Telekom and the Japanese SoftBank announced that they intended to move away from Huawei as a supplier of their network equipment. As a result, it is expected that both T-Mobile and Sprint may expect to obtain clearance for their planned merger as early as next week.
Can deflect
The two companies occupy the third and fourth position in the US telecoms market. Negotiations with the US authorities have not yet been concluded, so according to the sources, a deal could still be rejected. At the same time, these steps taken by the parent companies will help.
In the meantime, the American government is increasing the pressure on Huawei. The Chinese company is said to have cooperated with the Chinese government and to have built back doors into its equipment to make espionage possible. The company denies this, but as a result, several American and European telecom operators have already indicated that they do not use Huawei technology in the construction of their 5G networks.
The merger of T-Mobile US and Sprint is expected to become clear in the first half of 2019.
This news article was automatically translated from Dutch to give Techzine.eu a head start. All news articles after September 1, 2019 are written in native English and NOT translated. All our background stories are written in native English as well. For more information read our launch article.
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