T-Mobile spends $4.4 billion to acquire most of US Cellular

T-Mobile and US Cellular announced on Tuesday that they are entering into an agreement. The deal will result in T-Mobile acquiring most of US Cellular.

In a press release, US Cellular announced that it has entered into an agreement with T-Mobile to sell its wireless operations and select spectrum assets for $4.4 billion. The deal is said to include cash and “up to approximately $2 billion of assumed debt.” Up to $100 million of this cash is contingent on certain financial and operating metrics being met between signing and closing the deal, according to US Cellular.

With this deal, T-Mobile is set to receive the regional wireless carrier’s customers, stores, and approximately 30% of its spectrum assets. In addition, T-Mobile will enter into a licensing agreement that will allow it to lease space on over 2,000 towers.

There were earlier rumors that T-Mobile and Verizon could carve up US Cellular’s business to prevent regulators from blocking the deal. But there’s no word yet from Verizon. US Cellular and T-Mobile expect to close the deal in the middle of 2025 after regulatory approvals.

This news arrives only weeks after T-Mobile announced its acquisition of Ka’ena Corporation. That deal brought Mint Mobile, Ultra Mobile, and Plum into the fold.

What does this mean for US Cellular customers?

In a separate press release from T-Mobile, the Un-carrier says the deal will help improve coverage in rural areas for its customers. At the same time, US Cellular customers will have access to T-Mobile’s network, improving 5G connectivity for “underserved rural areas.”

CEO of T-Mobile Mike Sievert had this to say about the deal:

With this deal T-Mobile can extend the superior Un-carrier value and experiences that we’re famous for to millions of UScellular customers and deliver them lower-priced, value-packed plans and better connectivity on our best-in-class nationwide 5G network. As customers from both companies will get more coverage and more capacity from our combined footprint, our competitors will be forced to keep up – and even more consumers will benefit.

If you’re a US Cellular customer, T-Mobile says you’ll be able to stay on your current plan. But these customers will also have the option to switch to “an unlimited T-Mobile plan of their choosing with no switching costs.”

How are customers responding to the acquisition?

Although T-Mobile says customers will be able to stay on their current US Cellular plan or switch to a T-Mobile plan of their choosing, there are fears that the carrier will increase prices. This is reflected in the many comments that have spawned since the announcement. As one Reddit user points out, “They said “keep”, didn’t say anything about “at the same price”.”

When T-Mobile acquired Sprint, it agreed to raise prices only after five years of completing the merger. That timeline is almost up as the merger happened in 2020, so T-Mobile would be free to raise prices in 2025. It’s possible that T-Mobile could follow a similar path with this acquisition. Not to mention that the carrier recently announced it was raising prices on some legacy accounts. So the fears aren’t totally unwarranted.

Others have bemoaned the increasing consolidation happening within the industry. One Reddit user says:

Companies gobbling up the competition always claim a benefit to customers that is almost never realized. It’s a benefit to shareholders having less competition to keep prices down.

Another user adds to that sentiment saying, “Hahahahahahahaha sure just once in the history of companies merging it might turn out better for the customer.”

However, it appears not every customer is on the same page, as there are a few more positive takes. One Reddit user explains how their coverage improved after the Sprint merger:

For me, I had sprint. Coverage was awful. When T-mobile bought them my coverage improved drastically. I’ve never dropped signal where I used to on Sprint. Good things can come from stuff like this.

How do you feel about T-Mobile acquiring most of US Cellular? What do you think about the state of telecom providers in general? Let us know in the poll below.