Deutsche Telekom CEO denies T-Cellular/Dash deal will scale back competitors

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FILE PHOTO: An indication for a T-Cellular retailer is seen in Manhattan, New York, U.S., April 30, 2018. Information/Shannon Stapleton

NEW YORK (Information) – T-Cellular US Inc and Dash Corp didn’t pursue a merger so as to scale back value competitors within the U.S. wi-fi market, the chief govt of Deutsche Telekom, T-Cellular’s majority shareholder, testified on Tuesday in federal courtroom in Manhattan.

A bunch of state attorneys common, led by New York and California, are suing to cease the $26.5 billion merger between the wi-fi carriers, arguing it could result in greater costs.

Timotheus Höttges, who’s chairman of T-Cellular’s board, testified that T-Cellular sought to merge with its smaller rival to extend scale and achieve wi-fi spectrum, or airwaves that carry knowledge, however denied the aim was to cut back competitors. His testimony got here on the second day of a trial that’s anticipated to run till Dec. 20.

Attorneys for the states introduced proof on Tuesday from a T-Cellular board presentation in 2010, when the corporate first explored a take care of Dash, that mentioned the merger would have “potential to cut back value competitors.”

Höttges downplayed the presentation, saying it had been ready by advisers and was not an official Deutsche Telekom doc.

T-Cellular and Dash have already acquired approval for the deal from the U.S. Division of Justice and the Federal Communications Fee, after the businesses agreed to promote Dash’s pay as you go cellphone enterprise and a few spectrum to satellite tv for pc TV supplier Dish Community Corp.

The businesses argue that a stronger T-Cellular would end result from the proposed takeover, making it higher in a position to innovate and compete to cut back wi-fi costs. The case represents a break with the same old means of states coordinating with the federal authorities in reviewing mergers and customarily coming to a joint conclusion.

The states have argued that Dish isn’t a viable competitor within the wi-fi market that would exchange Dash because the fourth-largest provider. On Tuesday, Glenn Pomerantz, an lawyer representing California within the lawsuit, requested Höttges whether or not he was conscious that Dish had repeatedly didn’t construct a community utilizing its huge holdings of wi-fi spectrum.

Höttges testified that Dish founder and Chairman Charlie Ergen was “not straightforward to take care of,” however mentioned Ergen was identified for being a terrific entrepreneur and would have all of the elements wanted to construct a community as soon as the merger closed.

Reporting by Sheila Dang; Modifying by Noeleen Walder and Leslie Adler