05 July 2018
| James Pearce
The proposed merger between Sprint and T-Mobile in the US could be subjected to additional scrutiny due to the former’s ties to China, according to a report.
Bloomberg reports that US lawmakers are concerned by link
between Sprint’s majority owner SoftBank and
Chinese manufacturer Huawei, which, along with rival ZTE, has
been deemed a national security threat by the US Department of
The report claims US lawmakers are set to put pressure on
the Trump Administration when it assesses the proposed merger
between Sprint and T-Mobile, Deutsche Telekom’s US
In a letter seen by the news agency that is set to be sent
to Treasury Secretary next week, will ask the administration to
conduct "a full and robust national security investigation"
into the $26.5 billion deal, which was agreed earlier in the
year after years of speculation and negotiation.
The letter was drafted by critics of the deal who are
seeking signatures from members of the House of
Representatives. The deal will, which brings together the third
and fourth (T-Mobile and Sprint) wireless carriers in the US,
will need to be rubber-stamped by the Committee on Foreign
Investment in the US, and then approved by President Trump.
SoftBank, which became majority shareholder in Sprint in
2013, has a longstanding relationship with Huawei, which has
included recent trials of 5G technology and the involvement of
Wireless X Labs to demonstrate cutting edge use cases for IoT
and future technologies.
Sprint has pointed to its "strong record of compliance" with
US laws, including replacing $200 million of Clearwire
equipment after it acquired the company.
The letter comes as US officials and intelligence agencies
have labelled Huawei and ZTE as a security threat, leading to a
band on Huawei phones and quipment in the US military. The
strained relations with the Chinese vendors reportedly led
AT&T to ditch a plan to range Huawei phones in its stores,
whilst it has also cause significant problems for ZTE, which
was almost forced to shutdown due to a trade ban.
mergers and acquisitions,