UScellular offloads more spectrum to AT&T

The $1.018 billion will buy AT&T 1,250 million MHz-Pops of 3.45 GHz and 331 million MHz-Pops of 700 MHz B/C block licenses.

Some of the licenses being sold are owned by a third party, and so this is contingent upon UScellular's purchase by T-Mobile going through. Those licenses cover approximately 15% of the total MHz-Pops represented in the announced transaction.

In May, T-Mobile US agreed to a $4.4 billion cash and debt deal to acquire UScellular's mobile operations and certain spectrum assets, which included access to its portfolio of towers. The deal effectively signalled UScellular’s exit from the US mobile market.

At the time UScellular said that it will retain around 70% of its spectrum assets following the purchase deal and ‘will seek to opportunistically monetise these retained assets.’

Then last month it announced it would sell Verizon 663 million MHz POPs of its Cellular (850 MHz) spectrum licenses as well as 11 million MHz POPs of its AWS and 19 million MHz POPs of its PCS licenses, for $1 billion.

At the time it also said it had entered into agreements with two other unnamed operators for the sale of other spectrum licenses.

Following all these transactions UScellular says it will have reached agreements to monetise approximately 55% of the spectrum holdings (excluding mmWave) that were excluded from the proposed sale to T-Mobile, for a total consideration of around $2.02 billion. When including the T-Mobile transaction, it will have reached agreements to monetise approximately 70% of its total spectrum holdings, it points out for good measure.

"We are pleased with the significant value that will be realised in the various transactions recently announced," said Laurent C Therivel, UScellular 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 US  Furthermore, the terms of the agreement will ensure that there will be continued, uninterrupted service for UScellular customers in the interim." 

"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. The C-band licenses have a number of attributes that we believe are favourable 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."

As UScellular points out, all of this is dependent on the lynchpin deal with T-Mobile being given the regulatory green light. At the time of the announcement it said it was working towards that closing mid-2025.