T-Mobile US has struck an agreement to acquire most of the assets of UScellular, the country’s fourth-largest mobile operator, in a deal valued at US$4.4bn, the operator has announced. The Deutsche Telekom-owned operator will acquire UScellular’s customer base, its retail stores and some of its spectrum licences in a deal that is expected to close in mid-2025.
A deal of some sort had been expected, though previous reports had suggested that T-Mobile and Verizon might each acquire some assets. Chicago-based UScellular, which is majority owned by Telephone and Data Systems (TDS) and which has been considering its strategic options (including a trade sale) since last August, is a minnow compared with the three main mobile operators in the US (AT&T, T-Mobile US and Verizon) and is shrinking: It ended March with 4.05 million postpaid customers, down from 4.22 million a year earlier, and 436,000 pre-paid customers, down from 470,000. Its first-quarter revenues totalled US$950m, down 3.6 per cent from a year earlier, though its operating income nearly doubled year on year to US$51m.
“Upon closing, T-Mobile’s leading 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 on the country’s largest and fastest 5G network,” noted T-Mobile US in this announcement.
“This transaction will create a much-needed choice for wireless in areas with expensive and limited plans from AT&T and Verizon, and for those that have been limited to one or no options for home broadband connectivity. By tapping into the additional capacity and coverage created through the combined spectrum and wireless assets, T-Mobile will spur competition and expand its fast-growing home broadband offering and fixed wireless products to communities without competitive broadband options, further bridging the digital divide for hundreds of thousands of customers in UScellular’s footprint,” it added.
Once the deal has been completed, UScellular will retain ownership of some spectrum licences as well as its towers, with T-Mobile entering into a long-term arrangement to lease space on at least 2,100 additional towers that are to be retained by UScellular.
– The staff, TelecomTV
