Sprint Nextel Corp. Chief Executive Dan Hesse said Tuesday that the company plans to submit its concerns over AT&T Inc.'s proposed acquisition of T-Mobile USA to Congress, saying the deal would hurt the wireless industry.
The combined entity would have “tremendous” power, Hesse said at a wireless industry conference in Orlando, Fla. He said AT&T and Verizon Wireless would hold 79% of the U.S. market if regulators approve the deal.
Sprint shares fell 14% on Monday on concern AT&T’s $39-billion takeover of T-Mobile, announced March 20, would leave Sprint a weaker No. 3 player in the U.S. The deal still needs regulatory approval. Sprint also held talks about buying T-Mobile, people with knowledge of the matter said.
Hesse said Sprint would file its concerns to Congress during the review. The U.S. House Judiciary Committee said Monday that it would hold a hearing on the takeover. The committee will look into possible anti-competitive effects, said Rep. Lamar Smith (R-Texas), who heads the panel.
Jim Cicconi, senior executive vice president at AT&T, responded to Hesse’s comments in a statement.
“We understand Sprint has concerns, and we’ll be happy to address any they present, whether at the Justice Department, the FCC or the Congress,” Cicconi said. “We feel we have good and compelling answers. And we feel policymakers will readily understand that any company with whom AT&T competes may not be especially positive about anything which makes AT&T a better competitor in the wireless market.”
Hesse declined to say whether Sprint had held talks with T- Mobile. He told an audience at the wireless event that the acquisition by AT&T would consolidate too much power in the mobile phone market.
“I have concerns it would stifle innovation,” Hesse said.
Sprint shares rose 11 cents to $4.47.