UScellular will promote a piece of its remaining spectrum belongings to AT&T for a bit greater than $1 billion in money, together with 1,250 million MHz-POPs of three.45 GHz and 331 million MHz-POPs of 700 MHz B/C block licenses.
“We’re happy with the numerous worth that might be realized within the numerous transactions not too long ago introduced,” mentioned UScellular President and CEO Laurent Therivel. “This settlement provides a fourth cellular community operator, along with T-Cell, to the record of these whose subscribers will profit from the sale of our spectrum licenses. As with the opposite cellular community operators, we’re assured that AT&T can put it to productive use in communities all through the U.S. Moreover, the phrases of the settlement will be sure that there might be continued, uninterrupted service for UScellular prospects within the interim.”
UScellular mentioned that the transactions it has introduced so far with AT&T, Verizon and two different operators, account for about 55% of its spectrum holdings on a per megahertz-POP foundation—excluding its millimeter-wave spectrum. That, plus UScellular’s pending transaction to promote its wi-fi operations to T-Cell US, signifies that the corporate has roughly 30% of its holdings, minus mmWave, left.
“After our proposed gross sales, we might be left with 1.86 billion MHz-Pops of low and mid-band spectrum, in addition to 17.2 billion MHz-Pops of mmWave spectrum, with the substantial majority of retained worth within the C-band spectrum,” added Therivel.
“The C-band licenses have various attributes that we imagine are favorable to their long-term worth,” he continued. “First, our C-band licenses are positioned in a horny mid-band frequency that may ship excellent velocity and capability. Second, there’s a substantial 5G ecosystem of apparatus distributors and present infrastructure that makes use of C-band. Lastly, they’ve a prolonged build-out timeline, with first and second build-out dates of 2029 and 2033, respectively. This offers ample time and optionality for us to both monetize or deploy the spectrum sooner or later. We’ll proceed to search for methods to opportunistically monetize the C-band, in addition to the opposite remaining spectrum.”
UScellular’s majority shareholder, TDS, has already consented to the AT&T spectrum transaction. Like the opposite spectrum transactions, this one is contingent upon the profitable closing of T-Cell US’ acquisition of UScellular’s wi-fi operations.
UScellular not too long ago reported a continued downward slide in its complete working revenues, service revenues and web earnings, because it proceeds with promoting belongings and shifting its enterprise into being a telecom infrastructure supplier somewhat than a cellular community operator. Nevertheless, Fastened Wi-fi Entry (FWA) buyer base continues to develop, up 32% year-over-year to 140,000.
Therivel informed analysts on the corporate’s quarterly name that UScellular believes that the proposed sale of its wi-fi operations to T-Cell US is on observe to shut in mid-2025.
T-Cell US plans to purchase a portion of UScellular’s spectrum, plus its wi-fi subscribers, operations and community belongings apart from the corporate’s owned towers for about $4.4 billion. UScellular will retain the almost 4,400 towers that it owns, in addition to about 70% of its spectrum and its fairness technique investments together with its wi-fi partnerships, which the corporate mentioned generated about $158 million in earnings final 12 months.
UScellular is the fifth largest tower firm in the US, and this deal would solidify that place. The 2 corporations have mentioned that they’re going to put collectively a brand new, 15-year grasp lease settlement underneath which T-Mo will turn into a long-term tenant on not less than 2,600 of UScellular’s towers, guaranteeing the corporate an earnings stream for years to come back. T-Cell US is already a tenant on about 600 of UScellular’s towers, and it’ll turn into a tenant on not less than one other 2,105 websites after the deal.
Individually, UScellular struck one other take care of Verizon to promote a few of its remaining spectrum for about $1 billion. The spectrum take care of Verizon would contain the nationwide provider shopping for 663 million megahertz POPs of UScellular’s 850 MHz spectrum licenses, in addition to 19 million MHz POPs of its PCS licenses and 11 million MHz POPs of its AWS airwaves, for a complete consideration of $1 billion.
T-Cell US, in the meantime, will decide up nearly all of UScellular’s 700 MHz A block, AWS and PCS airwaves plus all of USM’s 600 MHz, 2.5 GHz and 24 GHz spectrum, if the acquisition transaction is authorized.
