UPDATE 1-Justice Department gives FCC go-ahead to rule on Sprint/SoftBank

Fri Jun 7, 2013 7:27pm EDT

June 7 (Reuters) - The U.S. Department of Justice on Friday gave the Federal Communications Commission the green light to make its ruling on SoftBank Corp's plan to purchase 70 percent of Sprint Nextel for $20.1 billion.

FCC approval would be the final regulatory hurdle for the deal but it still needs to be approved by shareholders. A June 12 shareholder vote may prove to be trickiest obstacle as SoftBank faces a $25.5 billion counter bid from Dish Network . Many shareholders have said they prefer Dish's offer.

The Justice Department was reviewing the national security implications of the deal as part of the so-called "Team Telecom" that includes the FBI and the Department of Homeland Security.

It said on Friday that it had no objections to the deal and so was withdrawing its January 2013 request that the FCC defer its decision. FCC sources say the agency's review, which focuses on U.S. market implications, is nearing completion but the chairman's office has yet to circulate a draft approval.

Friday's clearance from the Justice Department came after the Committee on Foreign Investment in the United States (CFIUS) told the companies the week before that it had completed its national security review of the proposed deal.