Sprint acquiring US Cellular Midwest spectrum and customers for $480 million

November 7, 2012
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Sprint has agreed to purchase select Midwest markets from US Cellular. This purchase will include spectrum and customers in parts of Illinois, Indiana, Michigan, Missouri and Ohio including the Chicago and St. Louis. The purchase price is $480 million and said to include roughly 585,000 customers. Or in terms of percentages, about 10 percent of the US Cellular customer base.

In terms of spectrum, this is further broken down by market. Sprint will get 20MHz of PCS spectrum from the 1900MHz band for “various” Midwest markets including Chicago, South Bend, Indiana and Champaign, Illinois. The sale will also include 10MHz of PCS spectrum in the St. Louis market.

While this should not affect the customers all that much, there is a downside for those selling US Cellular services and devices in those areas. According to details coming from US Cellular, they will “over time” be closing company and agent-owned stores. In addition, they noted that “upon completion of the transition services period, the majority of the company’s retail, engineering and business support associates in these markets will not be retained. ”

The purchase by Sprint will help them supplement coverage in those areas while they continue the Network Vision upgrade and roll-out 4G LTE. And for those that happen to be a US Cellular customer in an area not mentioned — rest assured in knowing that US Cellular will continue business operations outside of these markets following the closing.

In terms of the closing, this sale is expected to close in mid-2013. Of course, we should also point out that the sale is still subject to approvals by the Department of Justice and the Federal Communications Commission. In other words, while both parties have agreed to the terms, we still need to see the final approvals before we can call this a done deal.

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