T-Mobile to buy US Cellular's wireless operations in $4.4 billion deal


A T-Mobile store is pictured in the Manhattan borough of New York, New York, U.S., May 20, 2019. REUTERS/Carlo Allegri

(Reuters) -T-Mobile will buy almost all of regional carrier United States Cellular's wireless operations including customers, stores and 30% of its spectrum assets in a deal valued at $4.4 billion, the telecom giant said on Tuesday.

U.S. Cellular's shares jumped more than 10% in trading before the bell and comes nearly ten months after the company said it was exploring strategic options.

U.S. Cellular will retain ownership of about 70% of its spectrum, its equity-method investments as well as 4,400 telecom towers. It said T-Mobile will become a long-term tenant on at least at least 2,600 towers.

T-Mobile, which eyes improved coverage for its customers, will fund the deal in a combination of cash and up to $2 billion of debt to be assumed through an exchange offer to be made to some of U.S. Cellular's debtholders.

T-Mobile does not expect any impact on its financial forecast or shareholder return program for 2024. It expects an yield of about $1 billion in operating expense and capital spending cost synergies.

The deal is expected to close in mid-2025 after regulatory approvals, and shareholders are not expected to act on this deal, U.S. Cellular said.

It added that Telephone and Data Systems, which is a 83% shareholder of the regional carrier, has provided written consent approving the deal.

If the deal fails to go through, T-Mobile will pay U.S. Cellular a termination fee of $60 million, Telephone and Data Systems said in a filing.

Verizon was in talks to also buy parts of the regional carrier, the Wall Street Journal reported earlier this month.

(Reporting by Arsheeya Bajwa and Akash Sriram in Bengaluru; Additional reporting by Harshita Mary Varghese; Editing by Vijay Kishore, Savio D'Souza and Shailesh Kuber)

Follow us on our official WhatsApp channel for breaking news alerts and key updates!

   

Next In Tech News

How to identify and manage the most power-hungry apps on your smartphone
Users will have control over generative AI in Windows
Will your device support Apple Intelligence?
Gamers really are better drivers, a new survey reveals
From schoolwork to relationship advice: why might young people use an AI chatbot?
OpenAI CEO says company could become benefit corporation- The Information
Google loses bid to end US antitrust case over digital advertising
Apple, Meta set to face EU charges under landmark tech rules, sources say
New York recovers $50 million for defrauded Gemini Earn crypto investors
Tempus AI shares jump 8% in strong Nasdaq debut as US IPO market thaws

Others Also Read