T-Mobile and UScellular announced that T-Mobile has agreed to acquire substantially all of UScellular’s wireless operations, including UScellular’s wireless customers and stores, and certain specified spectrum assets. Upon the closing of the deal, T-Mobile’s leading 5G network will expand to provide millions of UScellular customers, particularly those in underserved rural areas, a better 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.
UScellular customers will also have the ability to fully participate in the Un-carrier’s industry-leading value-packed plans filled with benefits and perks, and reliable customer support with the opportunity to save UScellular customers hundreds of millions of dollars. And 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.
The combination of both companies’ spectrum and assets will bring UScellular customers a superior connected experience on T-Mobile’s nationwide 5G network. These companies’ customers, especially those in underserved rural areas, will receive access to faster and more reliable 5G service they would not otherwise have.
UScellular customers will have the option to stay on their current plans or move to an unlimited T-Mobile plan of their choosing with no switching costs, which include beloved Un-carrier benefits such as streaming and free international data roaming. And if UScellular customers choose to switch to T-Mobile, they could save hundreds of millions of dollars combined annually. Some will also have access to plans with increased savings previously not available to them such as T-Mobile’s 5G Unlimited 55+ plans. Plus, all customers can take advantage of T-Mobile’s customer service team and have better and more accessible in-person and digital retail support.
This deal 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. And 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.
T-Mobile has a track record of bringing companies together in the name of enhanced connectivity, choice, and value for consumers. And the integrations of MetroPCS in 2013 and Sprint in 2020 have been noted as two of the most successful merger combinations in wireless history that resulted in competition-enhancing shifts benefiting millions of consumers. Utilizing its playbook for successful integrations, T-Mobile will continue to deliver exceptional value and experiences to more people across the country while forcing others to follow suit for the good of customers.
T-Mobile will pay about $4.4 billion 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 deal, 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. And T-Mobile does not expect the transaction to impact the company’s 2024 guidance or 2024 authorized shareholder return program. T-Mobile expects this deal 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 deal, which is subject to the satisfaction of customary closing conditions and receipt of certain regulatory approvals, is expected to close in mid-2025.
Cleary Gottlieb Steen & Hamilton LLP and DLA Piper LLP are acting as legal counsel to T-Mobile.
KEY QUOTES:
“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. 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.”
– Mike Sievert, CEO of T-Mobile
“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. 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.”
– Laurent Therivel, CEO of UScellular
