UPDATE 1-U.S. Justice Department examining Softbank-Sprint deal
* FCC is asked to defer action on the deal
* Expert sees little risk to the acquisition
WASHINGTON Jan 29 (Reuters) - The Justice Department and the Department of Homeland Security are examining the proposed takeover of Sprint Nextel by Japan's Softbank Corp for national security and other issues, and have asked the U.S. telecommunications regulator to defer any action on the deal.
Softbank and Sprint agreed last year that Softbank Corp would pay $20 billion for control of Sprint Nextel Corp, giving the Japanese firm entry into the U.S. market and Sprint, the No. 3 U.S. carrier, much-needed cash.
The Justice Department and the Department of Homeland Security wrote a letter to the Federal Communications Commission saying they were looking at the deal, according to a filing at the FCC on Tuesday.
"We therefore request that the commission defer action until such time as the agencies notify the commission of the completion of their review," the letter said.
Sprint said the letter related to an investigation of the deal by the inter-agency Committee on Foreign Investment in the United States, which looks at significant foreign investments into the United States.
"This is a routine request when working with the CFIUS agencies regarding national security," said Sprint spokesman John Taylor.
The FCC had no comment on the letter.
The review is likely aimed at ensuring that Softbank continues to work with U.S. law enforcement to create wiretaps when there is a court order, said James Lewis, a cybersecurity expert with the Center for Strategic and International Affairs.
The DHS concern is likely focused on ensuring the security of critical infrastructure, he said.
He said there was minimal risk to the deal.
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