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Deutsche Telekom’s CEO denies T-Mobile/Sprint deal will reduce competition

FILE PHOTO: A sign for a local T-Mobile store is seen in downtown Manhattan, New York, New York, USA, on April 30, 2018. REUTERS/Shannon Stapleton

NEW YORK (Reuters) – T-Mobile US Inc and Sprint Corp will not seek a merger with a view to the reduction of price competition in the U.S. wireless market, the chief executive of Deutsche Telekom, T-Mobile’s majority shareholder, testified on Tuesday in federal court in new york city.

A group of state attorneys general, led by New York and California, to complain, to stop, and with a $26.5 billion merger between wireless carriers, on the ground that it would lead to higher prices.

Timotheus Höttges, who has been chairman of verizon’s board of directors, testified that T-Mobile was looking for along with its smaller rival to increase the scale to get wireless spectrum, or the airwaves that carry the data, but denied that the purpose was to restrict competition. His testimony came on the second day of an investigation, which is expected to run until Dec. 20.

The lawyers of the states parties, the evidence presented on Tuesday, T-Mobile’s board with a presentation in 2010, when the company first explored a deal for Sprint, who said that the merger would have the potential for a reduction in the price of the competition.”

Höttges played down the talk, saying: “it was drawn up by consultants, and it was not an official German Telekom) document.

T-Mobile and Sprint have already received approval for the deal from the U.S. Department of Justice and the Federal Communications Commission after the companies agreed to sell Sprint prepaid phone company, and a number of the power spectrum from satellite TV provider Dish Network Corp. (a).

The companies argue that a stronger T-Mobile might be the result of the acquisition, resulting in the ability to innovate and compete to reduce wireless prices. The case is a breach of the customary practice of the states in co-ordination with the federal government on the review of the merger and, generally, in order to arrive at a conclusion.

The states have also argued that the Court of first instance is not to be a viable competitor in the wireless market that will be able to replace Sprint as the world’s fourth-largest airline. On Tuesday, Glenn Pomerantz, a lawyer who is a California lawsuit, asked, Höttges, or that he was aware of the fact that the latter had repeatedly failed to build up a network, with its extensive holdings of wireless spectrum.

Höttges, testified that the latter’s founder and President, Charlie Ergs, it was “not an easy thing to deal with,” but said the Ergs, it was known to be a great trader, and would have all of the ingredients that are necessary for the construction of a network once the merger is closed.

Report by Sheila Dang; Editing by Noeleen Walder and Leslie Adler

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