Watch out AT&T and Verizon: Federal judge expected to clear T-Mobile Sprint merger, reports say

A federal judge will clear the way for T-Mobile's to combine forces with Sprint over the objections of a coalition of state attorneys general who argued the merger would result in higher mobile phone bills for customers, according to reports in the New York Times and the Wall Street Journal.

The decision, expected Tuesday, removes one of the last remaining challenges to the deal which would create a much larger competitor to wireless heavyweights AT&T and Verizon.

Shares of Sprint surged nearly 69% in after-hours trading Monday to $8.10.

It is not yet known if T-Mobile and Sprint, the No. 3 and No. 4 wireless carriers, will have to make any additional concessions beyond what they've already agreed to. Federal officials signed off on the deal after Sprint agreed to sell its Boost Mobile prepaid carrier unit to Dish and other concessions.

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During the trial in U.S. District Court in New York, 13 state attorneys general and the District of Columbia, attempted to persuade Judge Victor Marrero that the $26.5 billion deal should be blocked.

The  two wireless carriers struck a merger agreement about two years ago in an all-stock deal worth $26.5 billion. 

The impact of the deal remains uncertain. Critics say consumers will pay higher cellphone prices and as many as 30,000 jobs will be lost.
 

Though T-Mobile and Sprint have long claimed otherwise and committed to not raise prices for three years, messages by a Sprint executive revealed in federal court suggested he thought an acquisition by T-Mobile might increase prices.

Merger supporters have argued that a combined T-Mobile and Sprint will be a stronger competitor to AT&T and Verizon and will help keep prices low.