T-Mobile agrees $4.4bn deal for UScellular wireless ops
May 29, 2024
T-Mobile and UScellular have announced that T-Mobile has a deal agreed to acquire all of UScellular’s wireless operations. This includes UScellular’s wireless customers and stores across the US, as well as certain specified spectrum assets.
Upon closing, T-Mobile says its 5G network will expand to provide millions of UScellular customers, particularly those in underserved rural areas, a superior connectivity experience, moving from a roaming experience outside of the UScellular coverage area to full nationwide access. T-Mobile customers will also get access to UScellular’s network in areas that previously had limited coverage and the benefit of enhanced performance throughout UScellular’s footprint from the addition of the acquired UScellular spectrum to T-Mobile’s network.
“With this deal T-Mobile can extend the superior Un-carrier value and experiences that we’re famous for to millions of UScellular customers and deliver them lower-priced, value-packed plans and better connectivity on our best-in-class nationwide 5G network,” said Mike Sievert, CEO of T-Mobile. “As customers from both companies will get more coverage and more capacity from our combined footprint, our competitors will be forced to keep up – and even more consumers will benefit. The Un-carrier is all about shaking up wireless for the good of consumers and this deal is another way for us to continue doing even more of that.”
“T-Mobile’s purchase and integration of UScellular’s wireless operations will provide best-in-class connectivity to rural Americans through enhanced nationwide coverage and service offerings at more compelling price points,” added Laurent Therivel, CEO of UScellular. “The transaction provides our customers access to better coverage and speeds, as well as unlimited texting in more than 215 countries, content offers, device upgrades and other T-Mobile benefits.”
T-Mobile will pay approximately $4.4 billion (€4.06bn) for the assets being acquired from UScellular in the transaction in a combination of cash and up to $2 billion of debt to be assumed by T-Mobile through an exchange offer to be made to certain UScellular debtholders prior to closing. Following the closing of the transaction, UScellular will retain ownership of its other spectrum as well as its towers, with T-Mobile entering into a long-term arrangement to lease space on at least 2,100 additional towers being retained. T-Mobile does not expect the transaction to impact the company’s 2024 guidance or 2024 authorised shareholder return programme. T-Mobile expects this transaction will yield approximately $1 billion in effective total opex and capex annual run rate cost synergies upon integration, with total cost to achieve the integration currently estimated at between $2.2 billion to $2.6 billion. The company plans to reinvest a portion of synergies toward enhancing consumer choice, quality and competition in the wireless industry.
The transaction, which is subject to the satisfaction of customary closing conditions and receipt of certain regulatory approvals, is expected to close in mid-2025.