US telecom giant T-Mobile is set to acquire US Cellular’s wireless operations for an estimated $4.4 billion. The deal also included some spectrum assets.
In return, T-Mobile will be getting 4 million customers to its base and 30% of spectrum assets. The telco’s chief executive officer Mike Sievert said that the deal “creates a better experience for all of our customers with more coverage and more capacity.”
The company will get into a master license agreement on over 2,000 towers and also increase the lease term for around 600 towers where it already is a tenant.
The deal also lets T-Mobile exert more influence in the industry when competitors are less. “The writing is on the wall for the carriers and consolidation is now on the horizon and could speed up into 2025,” said Wedbush Securities analyst Dan Ives who predicts that such cooperation will emerge further in 2024. “This is the first shot across the bow in the wireless world and we expect more deals over the next year. Also read: T-Mobile expands its Ultra Capacity 5G to 300 million Americans
In the US, T-Mobile has made quite a name being active in mergers. In 2020, the company took over Sprint while in 2013, it obtained acquisition with MetroPCS Communications Inc.
T-Mobile has said that it will now coordinate US Cellular’s 5G network and will offer faster speed and coverage. Its benefits will be those who live in rural parts of the country.
“In the face of rising competition and increasing capital intensity required to keep pace with the latest technologies, and following our careful and deliberate strategic review, we are confident that continuing to deliver on our mission requires a level of scale and investment that is best achieved by integrating our wireless operations with those of T-Mobile,” U.S. Cellular Chair LeRoy Carlson Jr. said in a statement.
The telco said that the current users can stay on their existing plans or switch to an unlimited T-Mobile plan.
U.S. Cellular takes 70% of its spectrum portfolio across several spectrum bands.
The deal has been unanimously approved by the boards of the United States Cellular Corp. and Telephone and Data Systems Inc, hold the majority of shares in U.S. Cellular. The acquisition is expected to be completed by mid-2025.