by Byun Seonjin
Published 29 May.2024 05:34(KST)
U.S. mobile carrier T-Mobile has agreed to acquire certain business rights and spectrum licenses from regional mobile carrier US Cellular for $4.4 billion (approximately 6 trillion KRW).
According to Bloomberg and other foreign media on the 28th (local time), T-Mobile plans to acquire about 30% of the spectrum licenses held by US Cellular, as well as US Cellular stores and subscribers. The acquisition price includes cash held by US Cellular and debt worth approximately $2 billion (about 2.7 trillion KRW).
US Cellular is a regional mobile carrier providing services in 21 states across the U.S. It has about 4 million subscribers. The market value reaches $3.7 billion (about 5 trillion KRW).
After the merger and acquisition (M&A), US Cellular will retain 70% of its existing spectrum licenses and base stations. Previously, industry observers speculated that US Cellular might consider splitting and selling the company to address antitrust reviews by regulatory authorities. The acquisition agreement also includes a condition for US Cellular to lease its base stations to T-Mobile on a long-term basis.
Major U.S. mobile carriers are competitively securing spectrum to stabilize 5G services. As a result, the value of existing spectrum licenses has increased. T-Mobile acquired competitor Sprint in 2020, surpassing AT&T to become the second-largest U.S. mobile carrier after Verizon. Recently, it also acquired the startup carrier Mint Mobile.
Bloomberg forecasts that T-Mobile's acquisition of certain business rights from US Cellular will be completed around mid-2025 after regulatory approval.
Following the news, US Cellular's stock price surged 12.19% on the New York Stock Exchange that day. T-Mobile's stock rose by only 0.79%.
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