- Sprint’s stock fell 10% after hours Tuesday following a Wall Street Journal report that said the carrier’s merger with T-Mobile was unlikely as currently structured.
- Sprint and T-Mobile have argued that the merger is necessary to compete with the two largest carriers in the U.S., AT&T and Verizon.
- The companies also said the merger will help Sprint and T-Mobile provide greater access to 5G.
Staffers from the Justice Department have reportedly told both carriers that the deal may not be approved under its current structure, the Journal reported, citing people familiar with the matter.
Reuters later confirmed the report with one person familiar with the matter, who cautioned that a final decision has not been made.
Shares of Sprint plunged as much as 12% in after-hours trading following the report, while T-Mobile fell more than 4%.
A spokesman for Sprint declined to comment to CNBC. The Justice Department did not immediately respond to a request for comment.
About a year ago, T-Mobile and Sprint announced they had reached an all-stock stock deal to combine the companies. Shareholders of both companies approved the deal in October, which later received national security clearance.
Shares of Verizon slipped about 1% in postmarket trading Tuesday, while AT&T edged 0.6% lower.
Critics of the merger have argued it would lead to job loss, decreased competition and increased prices for consumers, especially in rural America.
In February, T-Mobile CEO John Legere defended the deal before Congress, asserting that the deal would create jobs and lower prices.
T-Mobile US Inc. shares fell $2.55 (-3.44%) in after-hours trading Tuesday. Year-to-date, TMUS has gained 16.49%, versus a 16.61% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of CNBC.