Sprint may be looking to make a bid for T-Mobile

Sprint Nextel Corp. is reportedly working on a bid for T-Mobile in a deal that could combine the No. 3 and No. 4 wireless carriers.

Sprint could make a bid for its rival in the first half of next year, according to the Wall Street Journal, which cited unnamed sources familiar with the matter.

The paper said a deal could be worth more than $20 billion.

A bid probably would face regulatory hurdles, as a merger would further consolidate an industry ruled by a small handful of wireless giants. Verizon Wireless is the country’s biggest wireless company, followed by AT&T.;

“If Sprint does acquire T-Mobile, it would transform them into a larger and stronger No. 3 competitor to both AT&T; Mobility and Verizon Wireless virtually overnight,” technology analyst Jeff Kagan said in a note to investors. “Whether the U.S. government would allow it is the question.”

Two years ago, AT&T;’s bid for T-Mobile was called off after running into opposition from the Department of Justice and the Federal Communications Commission, which opposed the deal on the grounds that it would create a less competitive wireless industry and potentially lead to higher prices for consumers.

A Sprint spokeswoman, responding to a request for comment from The Times, said the company doesn’t comment on “rumor and speculation.”

Earlier this year, Sprint shareholders approved a $21.6-billion deal to sell a majority stake in the wireless carrier to Japanese telecom giant SoftBank.

ALSO:

Sprint shareholders approve takeover by Japan’s SoftBank

AT&T;, T-Mobile, Sprint to stop charging for ‘premium’ text messages

Sprint is the worst cellphone service provider, Consumer Reports says