U.S. files to block AT&T buy of T-Mobile

WASHINGTON (Reuters) - The Obama administration on Wednesday filed to block AT&T's proposed acquisition of wireless rival T-Mobile USA because of anti-competitive concerns, two sources familiar with the matter said.

Blocking the combination on antitrust grounds would be a big blow to the telecommunication giant's expansion plans.

A Justice Department spokeswoman declined to comment as did a spokesman for AT&T. A Federal Communications Commission spokesperson said the commission has not made a decision to block the deal.

Shares in AT&T slid 3.5 percent to $28.66. Stock in rival Sprint Nextel Corp surged 9.9 percent to $3.90.

(Reporting by Jeremy Pelofsky. Editing by Robert MacMillan)