US Cellular gains on $1 bln spectrum assets deal with Verizon
Updates
** Shares of regional wireless carrier United States Cellular USM.N hit the highest level since 2008, last up 10.3% at $64.75
** USM has agreed to sell portion of its spectrum licenses such as those used for mobile phone signals and high-speed data services to Verizon VZ.N in a $1 bln deal
** Company has also agreed to sell part of its spectrum licenses to two other mobile network operators
** Raymond James views this announcement as a positive for both USM and VZ
** "We also believe this announcement is a modest positive for towers, as VZ will eventually need to deploy some of the spectrum in markets where they have not deployed cellular" - brokerage
** The deals are contingent on the closing of USM and T-Mobile US TMUS.O agreement, which is likely to be a long process and could face regulatory risk - Raymond James
** In May, USM agreed to sell almost all of its wireless operations, including customers, stores and 30% of its spectrum assets, to TMUS in $4.4 bln deal
** Up to last close, USM up ~41% YTD
Reporting by Harshita Mary Varghese and Jaspreet Singh in Bengaluru
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