AT&T is acquiring Leap Wireless for $15 per share, which makes the deal worth around $1.19 billion. Leap Wireless is the parent company of prepaid wireless provider Cricket. Cricket has 5 million subscribers. AT&T will absorb Leap’s customers, retail stores, and network licenses. Leap has subscribers across 35 states that are on their PCS and AWS bands. Leap Wireless was trading at low as $7.98 per share today, but it shot up to $16 per share during the after hours trading.
As of April 2013, Leap had around $2.8 billion of net debt. Leap’s shareholders will receive a contingent right that entitles them to the net proceeds received on the sale of Leap’s 700MHz “A Block” spectrum in Chicago. Leap purchased that spectrum for $204 million in August 2012. Leap’s network covers around 96 million people across 35 states.
AT&T will retain the Cricket brand name and provide Cricket customers with access to their AT&T’s 4G LTE mobile network. Around 29.8% of Leap’s outstanding shares owners entered into an agreement to vote in favor of the transactions.