AT&T announced today that it has signed an agreement with Atlantic Tele-Network (ATNI) to acquire its US retail wireless operations for $780 million in cash.
The firm's US operations — including wireless properties, licenses, network assets, retail stores — which operates under the Alltel brand in the US, will be acquired by AT&T in the all-cash deal.
AT&T will also receive 585,000 subscribers.
The acquisition will also see a range of spectrum acquired by the US cellular giant — which at the last counthad more than 105 million US subscribers — including in the 700MHz, 850MHz, and 1900MHz bands, which will largely complement AT&T's existing network.
ATNI's network in the US covers around 4.6 million people, particularly those in rural areas of Georgia, Idaho, Illinois, North Carolina, Ohio, and South Carolina.
ATNI operates a small CDMA network for subscribers in its markets, but this will not be compatible with AT&T's GSM network. However, the integration costs for the CDMA network conversion will not result in a significant dilution to the firm's earnings per share or cash flow, the cellular giant said.
AT&T said that as it upgrades its network, existing ATNI and AT&T customers who roam in these areas will be able to receive enhanced mobile Internet access.
The cellular giant is expected to report. AT&T is expected to see a $10 billion charge in the fourth quarter and an operating loss of $175 million.