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T-Mobile, Sprint Parents May Drop Huawei Gear to Facilitate Merger

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Dec 14, 2018, 4:04 PM by Eric M. Zeman

T-Mobile and Sprint expect their proposed merger will be given the green light by government security officials as soon as next week, according to a report from Reuters. The Committee on Foreign Investment in the United States (CFIUS) has been reviewing the merger for potential security issues. At the same time, government officials have been pressuring Deutsche Telekom, T-Mobile's parent organization, and SoftBank, Sprint's parent organization, to cease use of Huawei networking gear. The U.S. insists that Huawei gear may include a back door that could be accessible to the Chinese government for spying purposes. Deutsche Telekom agreed to review its use of Huawei gear in its home country of Germany and other European markets. SoftBank says it will replace 4G Huawei equipment with new gear from Nokia and Ericsson. These concessions appear to be enough for CFIUS, say Reuters' sources, and the security committee may grant T-Mobile and Sprint the permission they need to move forward with the merger. The deal still needs to be approved by the FCC and Department of Justice. The companies expect the deal to be finalized in early 2019. None of the firms mentioned by Reuters offered comment on the report.

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