Sprint today indicated that it has reached an agreement with the Committee on Foreign Investment in the United States (CFIUS) regarding SoftBank’s proposed equity acquisition of Sprint.
Per the National Security Agreement, CFIUS has agreed to approve the proposal, which means the Department of Justice, the Federal Bureau of Investigation, and the Department of Homeland Security will all tell the Federal Communications Commission to move forward with its public interest review of the proposal. The FCC’s review is ongoing, and the deal still needs to be approved by Sprint’s shareholders.
Sprint did not provide details regarding the National Security Agreement, but The Wall Street Journal reports that Sprint has agreed to create a four-person committee to oversee matters of national security, and that one member of the committee will sit on Sprint’s board of directors. Further, the U.S. government will have veto power over Sprint’s telecommunication equipment purchases, and Sprint will have to remove all Chinese-made equipment from Clearwire’s network infrastructure by 2016.
The federal government often adds restrictions to foreign take-overs of U.S. firms, but because Sprint performs classified services for the government, this deal required a more thorough review and tighter restrictions.
