AT&T agrees to acquire Verizon spectrum for $1.9 billion
AT&T has entered into an agreement to acquire mobile spectrum from rival Verizon Wireless for $1.9 billion in cash and 10MHz AWS licences in western US markets.
The deal includes 39 Verizon 700MHz B Block licences in five markets and will see AT&T transfer AWS licences in Los Angeles, Phoenix, Fresno, California and Portland, Oregon.
AT&T said the Verizon licences cover a population of 42 million in the US across 18 states; California, Colorado, Florida, Idaho, Illinois, Louisiana, Montana, New Mexico, New York, Ohio, Oklahoma, South Dakota, Tennessee, Texas, Utah, Virginia, Washington and Wyoming.
The deal is expected to close in the second half of 2013, subject to regulatory approval.
Verizon is selling the spectrum as part of a commitment made to regulators last year while it was seeking approval to acquire AWS frequencies from the SpectrumCo consortium of cable operators.
At the same time as the AT&T deal the leading LTE operator in the US is selling lower 700MHz B block licences covering Charlotte, Greensboro, and Releigh Durham in North Carolina to private equity firm Grain management for $189 million.
The bulk of the spectrum being sold was won by Verizon at auction in 2008.
AT&T also said it will sell one AWS licence to Grain and lease spectrum from the company in three markets. Verizon plans to lease this AWS licence from Grain.
Verizon expects to finish its LTE deployment by the middle of 2013 and plans to activate its AWS spectrum this year in locations needing extra capacity. It now covers 273.5 million people with its LTE network in the US, roughly 89% of the population, compared to the 174 million people covered by AT&T.
AT&T plans to extend its LTE reach to 300 million people in the US by the end of 2014.
Earlier this week AT&T also announced a deal to acquire the retail arm of Atlantic Tele-Network, including spectrum licences, network assets and stores for $780 million.