T-Mobile to Acquire US Cellular in $4.4 Billion Deal

T-Mobile is set to acquire US Cellular, one of the largest carriers in the U.S., in a landmark deal valued at $4.4 billion. Despite US Cellular’s regional focus around the Chicago area, it ranks as the fifth-largest carrier nationally and operates its own towers and stores, distinct from mobile virtual network operators (MVNOs) like Metro by T-Mobile or Visible.

The acquisition will see T-Mobile assume $2 billion of US Cellular’s debt and take over its wireless customers, stores, and 30% of its spectrum assets. US Cellular will retain control of 4,400 towers and 70% of its spectrum portfolio, while T-Mobile will extend leases for 600 towers and sign new long-term leases for 2,015 additional towers. T-Mobile has committed to hiring a substantial number of U.S. Cellular associates as part of the deal.

Existing US Cellular customers will have the option to retain their current plans or migrate to a T-Mobile unlimited plan at no additional cost. T-Mobile anticipates potential cost savings for customers with access to enhanced plans.

For T-Mobile, the acquisition addresses longstanding issues with rural service coverage, where it trails Verizon and smaller regional carriers. US Cellular’s extensive mid-band network coverage, already reaching 1 million households, is expected to expand to 3 million by the end of 2024, bolstering T-Mobile’s 5G network capabilities.

CEO Laurent Therivel of US Cellular noted, “T-Mobile’s purchase and integration of US Cellular’s wireless operations will provide best-in-class connectivity to rural Americans through enhanced nationwide coverage and service offerings at more compelling price points.”

The acquisition is subject to regulatory approval, with T-Mobile aiming to finalize the deal by mid-2025. Boards of both US Cellular and its parent company, Telephone and Data Systems, have already greenlit the acquisition.

This move follows T-Mobile’s previous acquisitions, including the merger with Sprint in 2020 and the acquisition of Mint Mobile in 2023. Regulatory hurdles are not expected to be significant given competition with Verizon and AT&T, although T-Mobile may consider sharing ownership of US Cellular with Verizon to preempt any regulatory concerns.

Ultimately, the acquisition may reduce consumer alternatives for affordable alternatives to major carriers like Verizon and AT&T.