December 20, 2019 / 3:25 PM / a month ago

U.S. Justice Department and FCC fight state effort to block merger of Sprint, T-Mobile

A Sprint sign is seen on top of a Sprint retail store in Manhattan, New York, U.S., September 22, 2017. REUTERS/Amr Alfiky

WASHINGTON (Reuters) - The U.S. Justice Department and Federal Communications Commission filed in court on Friday to support a merger of T-Mobile (TMUS.O) and Sprint (S.N), the third- and fourth-largest wireless carriers.

A group of state attorneys general has asked a judge to stop the $26 billion deal, saying it would lead to higher prices for customers. The case is being heard in federal court in New York and could wrap up on Friday.

In their filing, the Justice Department and FCC argued that if the states, led by New York and California, succeed in killing the deal the end result will be that rural areas of the United States will be slower to get access to 5G, the next generation of wireless.

“Specifically, T-Mobile has committed to providing 5G coverage to 85% of the rural population within three

years, and 90% of the rural population within six years,” the agencies said in the filing.

The Justice Department approved the merger in July after the carriers agreed to sell some assets to satellite provider Dish. The FCC formally approved the merger in October.

The agencies also noted that 13 states and the District of Columbia have sought to kill the planned merger, and said that the deal struck with Dish constitutes “substantial relief.”

They also say that 10 states have signed on to the Justice Department’s decision to approve the merger, while three more made public statements backing it.

Reporting by Diane Bartz and David Shepardson; Editing by Chizu Nomiyama and Dan Grebler

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