The California Public Utilities Commission voted Thursday to...
The California Public Utilities Commission voted Thursday to approve SoftBank’s plan to buy majority control of Sprint Nextel -- the last of the state regulatory agencies that needed to clear the transaction. SoftBank had filed with agencies in 23 states…
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and Washington, D.C., SoftBank and Sprint said in a joint statement (http://bit.ly/16R7ef4). SoftBank continues to work with the FCC, Department of Justice and the Treasury Department-led Committee on Foreign Investment in the U.S. (CFIUS) to complete those agencies’ review of the deal, and believes it will be able to close the deal as expected on July 1, a SoftBank spokesman said. SoftBank’s negotiations with the agencies include a plan to allow the U.S. government to have veto power over one of its appointees to Sprint Nextel’s board; that plan had already been publicly disclosed prior to a Wall Street Journal report, the SoftBank spokesman said. That appointee would serve as the “Security Director” in charge of ensuring implementation of the network security agreement SoftBank is negotiating with government agencies that are reviewing SoftBank’s $20.1 billion bid to buy 70 percent ownership of Sprint, according to a Sprint proxy filed with the SEC earlier this month (http://1.usa.gov/12qWkFv). The Wall Street Journal report also said CFIUS wants Sprint-controlled Clearwire to remove equipment manufactured by Chinese telecom equipment manufacturer Huawei from its network. SoftBank and Sprint have previously told House Intelligence Committee Chairman Mike Rogers, R-Mich., they would exclude Huawei’s equipment from the Sprint network and would work to replace Huawei equipment on Clearwire’s network (CD April 1 p5). “Those plans confirm the serious national security risks of SoftBank acquiring Sprint and its wireless and wireline assets of national strategic importance,” said Dish Network General Counsel Stanton Dodge in a statement Thursday. Dish remains “concerned, however, that these reported steps do not adequately protect our national security interests, especially with respect to Sprint’s critical fiber backbone network and Sprint’s extensive contracts to provide important telecommunications services for government, law enforcement and defense customers,” he said (http://bit.ly/1acFq1B). Dish has long opposed the deal, and has made a $25.5 billion counterbid for Sprint. Dish has recently ramped up its criticism of the SoftBank deal on national security grounds, launching a website Monday that outlined what Dish claims are problematic SoftBank ties to Huawei, UTStarcom and Chinese e-commerce company Alibaba (CD May 21 p9). SoftBank’s bid actually “enhances U.S. national security,” the SoftBank spokesman said. “Only SoftBank has committed to moving the existing equipment that the government has concerns about. Dish has not made any such commitments, so their arguments about national security are a little hypocritical.” Senate Armed Services Committee Ranking Member John McCain, R-Ariz., urged the FCC in a letter Thursday to consider the national and economic security implications of SoftBank’s bid. “Sprint holds strategic assets, such as its wireless spectrum and fiber network, and has extensive and ongoing relationships throughout the whole government,” the letter said. “With all other relevant facts and circumstances surrounding Softbank’s proposed acquisition of Sprint, I hope the Commission duly considers these facts when reviewing this matter.”