Cogent acquires T-Mobile’s wireline business
T-Mobile has sold its wireline business to Cogent Communications for an initial US$1 but will take a US$1 billion charge on the deal.
T-Mobile has been turning its attention away from the wireline business that includes assets from its US$26 billion acquisition of Sprint in 2020.
Its wireline business made around US$739 million in revenue last year and includes communications systems, data processing equipment and fibre optic cables.
The deal is expected to close in the second half of 2023
For Cogent, the company says the deal underlines its commitment to service its wireline business customers, adding that the deal will go some way in cementing its future for the strong legacy business.
In addition to the fibre network and assets, Cogent will acquire certain liabilities associated with the business.
The parties will enter a separate agreement that will see Cogent offer IP transit services to T-Mobile for 54 months following the closing data.
T-Mobile will pay Cogent US$700 million for those services, with US$350 million due in equal payments over the first 12 months after closing and US$350 million due in equal payments over the remaining 42 months.