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Sprint to Buy Customers and Spectrum for $480 Million

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Wireless carrier Sprint Nextel (NYSE: S  ) has announced that it will acquire PCS spectrum and customers from U.S. Cellular (NYSE: USM  ) for $480 million and the assumption of certain liabilities. The markets being included in the deal are in Illinois, Indiana, Michigan, Missouri, and Ohio, including the Chicago and St. Louis markets.

Sprint CEO Dan Hesse said the transaction will bolster Sprint's competitive position and add to its network capacity and beef up service in the Midwest, and help with its 4G LTE rollout. Sprint is acquiring 20 MHz of spectrum within the 1900 MHz band in most of these markets, and 10 MHz of spectrum in the St. Louis market. Approximately 585,000 U.S. Cellular customers are involved in the deal, about 10% of U.S. Cellular's total customer base.

"Exiting these markets enables us to play to our strengths in markets where we have higher penetration and where we can effectively sharpen our proven strategy to differentiate the U.S. Cellular customer experience from other wireless carriers," U.S. Cellular CEO Mary N. Dillon said in a statement.

The transaction is subject to regulatory approvals, and is expected to close in mid-2013. U.S. Cellular customers won't be affected until then.

 

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Evan Niu
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Evan is a Senior Technology Specialist at The Motley Fool. He was previously a Senior Trading Specialist at a major discount broker. Evan graduated from the University of Texas at Austin, and is a CFA charterholder.

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Related Tickers

7/2/2015 4:00 PM
S $4.48 Down -0.04 -0.88%
Sprint CAPS Rating: ***
USM $38.46 Up +0.10 +0.26%
United States Cell… CAPS Rating: No stars

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