SoftBank’s credit has been downgraded following the FCC’s approval of its acquisitions of Sprint and Clearwire, which SoftBank said it expects to close on July 10th. Standard & Poor’s cut the company’s credit rating from a BBB grade to a BB+ junk rating, Bloomberg reported. The agency citied SoftBank’s “exposure to intense competition in the U.S. market,” which is “unlikely to subside substantially in the next two to three years.” It noted, however, that it expects Sprint’s “operating performance to improve gradually” due to cost reductions and “other merger benefits.” A lower credit rating means there is a higher chance a company will default on its loans, which ultimately raises borrowing costs. Sprint shareholders last month agreed to SoftBank’s proposal of $21.6 billion in cash and stock for an 80% stake in the company.