CHICAGO, Nov. 7, 2024
/PRNewswire/ -- United States Cellular Corporation (NYSE: USM)
today has announced that it has entered into an agreement with
AT&T (NYSE: T) to sell a portion of the Company's retained
spectrum licenses for total consideration of $1.018 billion. The transaction is part of
the objective UScellular announced on May
28, 2024, to opportunistically monetize the spectrum that
was not included in the proposed sale to T-Mobile; and follows the
transactions previously announced on October
18, 2024, to sell a portion of the retained spectrum
licenses to Verizon and two other mobile network operators.
"We are pleased with the significant value that will be realized
in the various transactions recently announced," said Laurent C. Therivel, President and CEO.
"This agreement adds a fourth mobile network operator, in addition
to T-Mobile, to the list of those whose subscribers will benefit
from the sale of our spectrum licenses. As with the other
mobile network operators, we are confident that AT&T can put it
to productive use in communities throughout the U.S.
Furthermore, the terms of the agreement will ensure that there will
be continued, uninterrupted service for UScellular customers in the
interim."
Following this transaction, as well as those previously
announced, UScellular will have reached definitive agreements to
monetize approximately 55%, measured on a MHz-Pops basis, of the
spectrum holdings (excluding mmWave) that were excluded from the
proposed sale to T-Mobile, for a total consideration of
approximately $2.02 billion.
Including the proposed T-Mobile transaction, UScellular will
have reached agreements to monetize approximately 70% of its total
spectrum holdings (excluding mmWave), measured on a MHz-Pops
basis.
"After our proposed sales, we will be left with 1.86 billion
MHz-Pops of low and mid-band spectrum, as well as 17.2 billion
MHz-Pops of mmWave spectrum, with the substantial majority of
retained value in the C-band spectrum," added Therivel.
"The C-band licenses have a number of attributes that we
believe are favorable to their long-term value. First, our
C-band licenses are positioned in an attractive mid-band frequency
that can deliver outstanding speed and capacity. Second,
there is a substantial 5G ecosystem of equipment vendors and
existing infrastructure that uses C-band. Finally, they have
a lengthy build-out timeline, with first and second build-out
dates of 2029 and 2033, respectively. This provides ample
time and optionality for us to either monetize or deploy the
spectrum in the future. We will continue to look for ways to
opportunistically monetize the C-band, as well as the other
remaining spectrum."
Transaction Details
The agreement with AT&T
includes the sale of 1,250 million MHz-Pops of 3.45 GHz and 331
million MHz-Pops of 700 MHz B/C block licenses for a total of
$1.018 billion. The purchase
price is payable in cash and subject to certain potential
adjustments, as specified in the purchase agreement.
Substantially all of the transaction is contingent upon the
closing of the sale of the UScellular wireless operations and
select spectrum assets to T-Mobile and is subject to the receipt of
regulatory approvals and satisfaction of customary closing
conditions.
Some of the licenses being sold to AT&T are owned by a third
party. Their sale to AT&T is contingent upon UScellular's
purchase, which is pending receipt of regulatory approval, of the
equity in the third party that UScellular does not currently
own. Those licenses cover approximately 15% of the total
MHz-Pops represented in the announced transaction.
Other Transaction Details
TDS, in its role as the 83
percent shareholder of UScellular, has delivered its written
consent approving the AT&T transaction. No further action
by UScellular's shareholders will be needed or solicited in
connection with the transaction.
Advisors
Citigroup Global Markets Inc. is serving as
lead financial advisor and Centerview Partners LLC is serving as
financial advisor to TDS. TD Securities (USA) LLC and Wells Fargo are also serving as
financial advisors to TDS. Wilkinson Barker Knauer, LLP is
serving as lead transactional and FCC regulatory counsel to both
TDS and UScellular. In addition, Clifford Chance LLP is
serving as regulatory advisor to both TDS and UScellular and Sidley
Austin LLP is serving as legal advisor to TDS. PJT Partners
LP is serving as financial advisor and Cravath, Swaine & Moore
LLP is serving as legal advisor to the independent directors of
UScellular.
About UScellular
United States Cellular Corporation
provides a comprehensive range of wireless products and services,
excellent customer support, and a high-quality network to customers
with 4.5 million retail connections in 21 states. The Chicago-based company had 4,200 full- and
part-time associates as of September 30,
2024. At the end of the third quarter of 2024, Telephone and
Data Systems, Inc. owned approximately 83 percent of UScellular.
For more information about UScellular, visit uscellular.com.
Safe Harbor Statement Under the Private Securities Litigation
Reform Act of 1995: All information set forth in this news release,
except historical and factual information, represents
forward-looking statements. This includes all statements about the
company's plans, beliefs, estimates, and expectations. These
statements are based on current estimates, projections, and
assumptions, which involve certain risks and uncertainties that
could cause actual results to differ materially from those in the
forward-looking statements. Important factors that may affect these
forward-looking statements include, but are not limited to: whether
the previously announced transaction whereby UScellular has agreed
to sell its wireless operations and selected spectrum assets to
T-Mobile will be successfully completed or whether UScellular will
be able to find buyers at mutually agreeable prices for its
remaining spectrum assets; whether the previously announced
transaction with Verizon will be successfully completed; whether
the transactions announced today with AT&T will be successfully
completed; whether these transactions will have an adverse impact
on UScellular's business; and other risks and uncertainties that
are more fully described under "Risk Factors" in the most recent
filing of UScellular's Form 10-K, as updated by any UScellular Form
10-Q filed subsequent to such Form 10-K.
For more information about UScellular, visit:
www.uscellular.com
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SOURCE United States Cellular Corporation