T-Mobile Expands Network Horizons: Acquiring Comcast Airwaves in $3.3B FCC-Backed Deal

T-Mobile US Inc TMUS looks to acquire Airwaves from Comcast Corp CMCSA in a cash deal worth $1.2 billion - $3.3 billion, with plans to close the purchase by 2028 pending approval from the U.S. Federal Communications Commission (FCC). 

The move will bolster the second-largest U.S. wireless carrier's network capabilities, especially in New York City, Orlando, and Kansas City. 

The low-band 600-megahertz spectrum can cover larger areas and penetrate walls and windows more effectively than higher frequencies, Bloomberg reports.

Also this week, the leading telecom company agreed to raise $2 billion via senior note offering.

The acquisition will enable T-Mobile to exercise greater control over network quality and incorporate crucial long-range frequencies. 

It's part of T-Mobile's broader strategy to secure additional spectrum licenses, with a pending $3.5 billion acquisition of 600-megahertz licenses from Columbia Capital covering cities such as San Francisco, Atlanta, Chicago, Los Angeles, and Boston. 

However, this deal has also faced regulatory scrutiny, with Dish Network Corp DISH filing a complaint with the FCC, arguing that it would grant T-Mobile an unfair share of airwaves.

On the other hand, Comcast has decided to divest its 600-megahertz airwaves as it primarily uses mid-band spectrum CBRS. 

In August, T-Mobile disclosed plans to downsize its workforce by just under 7% or 5,000 positions.

In July, T-Mobile US reported second-quarter revenue of $19.2 billion, a decline of 2.6% year-on-year, missing the consensus of $19.3 billion. EPS of $1.86 beat the consensus of $1.69.

Price Action: TMUS shares traded lower by 0.79% at $139.00 premarket on the last check Wednesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.