T-Mobile Reaches Divestiture Deal With Dish in Hopes of Gaining Approval for Sprint Merger

T-Mobile has reached a divestiture deal with Dish Network that perhaps brings it one step closer to earning government approval for its planned merger with Sprint, reports CNBC.

Dish Network and T-Mobile had been discussing a deal for Sprint's Boost Mobile brand and some wireless spectrum to ease antitrust concerns over the merger.

Though the two companies have much of the divestiture deal in place, sources that spoke to CNBC said that there are still issues that the Justice Department is "actively focused on" before it would allow a deal.

The government continues to be concerned that the agreement between Dish and T-Mobile isn't enough to make sure that Dish would provide meaningful competition in the U.S. cellular market.

The DoJ wants Sprint and T-Mobile to ensure that there continues to be a fourth major carrier in the United States following their merger. The combination of Sprint and T-Mobile, which would be called T-Mobile and would be led by John Legere, would leave the U.S. with three major carriers: T-Mobile, AT&T, and Verizon.

T-Mobile wants to limit Dish's spectrum capacity to 12.5 percent, while T-Mobile parent company Deutsche Telekom wants to limit any strategic Dish investor to five percent, restrictions the DoJ may not be happy with.

Sprint and T-Mobile first announced a merger agreement in April 2018, but the completion of the deal continues to require government approval. As of May, U.S. regulators were said to be "leaning against" approving the merger unless some of T-Mobile and Sprint's assets were sold off, and T-Mobile and Sprint have been working toward that goal.