The U.S. Federal Trade Commission approved Sprint Nextel's $483 million acquisition bid for prepaid player Virgin Mobile USA, moving the deal one step closer to completion.
The FTC's ruling comes less than a month after Sprint announced its intentions to acquire Virgin Mobile, which operates as an MVNO on Sprint's CDMA network. The deal, if approved, will effectively double Sprint's commitment to the prepaid market, sitting alongside its iDEN-centric, Boost Mobile-branded prepaid service.
Sprint and Virgin expect the deal to close in the fourth quarter of this year or early next year. Still pending is consent from Virgin Mobile shareholders, the FCC and the Securities and Exchange Commission.
However, there remains several possible hiccups. First, Virgin Mobile holds some international licenses that will have to be transferred to Sprint, according to a Stifel Nicolaus report. The FCC will have to review the transfer, and thought that may take time, Stifel Nicolaus doubted it would be a "serious obstacle." Separately, a class-action lawsuit filed earlier this month claims the deal undervalues Virgin Mobile; naturally, both Sprint and Virgin have said that they believe the acquisition is in the best interest of shareholders.
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