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USA's Department of Justice Intervenes in Sprint-Softbank Deal

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The USA's Department of Justice has steeped into the takeover of Sprint Nextel by Japan's Softbank citing concerns about national security and asked for a delay in the approvals process.

In a letter to the telecoms regulator, the DOJ said that itself, along with the FBI and Department of Homeland Security are currently reviewing this matter for any national security, law enforcement, and public safety issues but have not yet completed that effort.

The three organisations therefore requested that the telecoms regulator defer action until such time as the Agencies notify the Commission of the completion of their review.

"DOJ, FBI, and DHS will advise the Commission promptly upon completion of our review." the DOJ added in its note.

Japan's Softbank is seeking approval to buy a 70% stake in Sprint Nextel, and also if approved, to take an effective 70% stake in Clearwire which Sprint has launched a separate bid for.

The intervention of the DOJ is not entirely unexpected as it tends to get involved in big deals of this nature, and Softbank's purchases of Huawei equipment for its Japanese networks was expected to raise concerns with US politicians.

It was largely pressure from the DOJ that lead to the collapse of last years planned merged between T-Mobile USA and AT&T.

On the web: DOJ Letter

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Tags: department of justice  sprint nextel  softbank  USA