Verizon wins Straight Path with $3.1bn bid for millimetre 5G spectrum
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Verizon wins Straight Path with $3.1bn bid for millimetre 5G spectrum

Verizon has succeeded in buying Straight Path Communications, a US company with millimetre wave spectrum that is suitable for 5G, after a bidding war with AT&T.

Straight Path’s shareholders will get $3.1 billion, five times the company’s share value just over a month ago, when AT&T bid $1.6 billion. Verizon came into the battle only two weeks ago, as a so-called “mystery bidder” whose identity was unveiled almost immediately, and increased its bid three days ago.

Straight Path, based in Virginia, said this morning that “it will terminate the previously announced definitive agreement and plan of merger with AT&T”, and Verizon will pay AT&T $38 million for the privilege of beating it in an auction.

It will be an all-stock transaction. Straight Path shareholders will get Verizon shares worth the agreed $3.1 billion.

Straight Path’s attraction to Verizon is its spectrum in the 28GHz and 39GHz bands. Verizon already owns a significant amount of 28GHz spectrum, and will get 20% more by buying Straight Path. AT&T owns none in that band.

Straight Path owns a huge amount of spectrum in the 39GHz bands – more than 12 times what all other US operators have together.

Neither Verizon nor Straight Path commented on the deal, which has been approved by the boards of directors of both companies.

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