The FCC set the pleading cycle (i.e., a set of dates for filing petitions, oppositions, and replies in a legal proceeding) for T-Mobile’s acquisition of most of UScellular’s wireless operations in a $4.4 billion deal. The telecoms have asked the FCC to approve the transfer of control and assignment of certain spectrum licenses, an international section 214 authorization, and spectrum leases held by UScellular (NYSE: USM) and its subsidiaries to T-Mobile (NASDAQ: TMUS).
Under the proposed transaction, T-Mobile would acquire UScellular’s wireless operations, customers, and approximately 30 percent of UScellular’s licensed spectrum. T-Mobile also is entering into a long-term arrangement to lease space on more than 2,000 towers from UScellular.
To assist with transitioning UScellular’s customers to T-Mobile’s network, the parties have filed a series of short-term spectrum manager leases for a period not to exceed one year after the closing of this transaction.
According to the Commission, “the proposed transaction would involve two major steps: (1) the restructuring of UScellular such that the assets being sold to T-Mobile would be moved into USCC Wireless Holdings, LLC (Holdings), a Delaware Limited Liability Company; and (2) the transfer of Holdings from UScellular to T-Mobile USA, Inc., which is a wholly owned direct subsidiary of T-Mobile. As a result of the transaction, Holdings and its subsidiaries would be indirect, wholly owned subsidiaries of T-Mobile, and their Commission licenses and authorizations would be indirectly controlled by T-Mobile.”
The applicants have submitted a spectrum aggregation chart that indicates that T-Mobile would be acquiring 10 to 131.5 MHz of spectrum in 808 counties across the United States. According to the chart, in counties where T-Mobile is gaining spectrum and there is geographical overlap, T-Mobile would hold a maximum of 381 MHz of spectrum post-transaction.
T-Mobile is controlled by Deutsche Telekom AG (DT), a German corporation. Deutsche Telekom Holding B.V., a Netherlands entity and an indirect wholly owned subsidiary of DT, holds a direct 50.42 percent equity and voting interest in T-Mobile. In addition, DT holds a proxy to vote additional shares of T-Mobile. As a result, DT has an indirect 50.42 percent equity interest and 100 percent voting interest in T-Mobile.
The applicants state that they have an existing foreign ownership ruling under section 310(b)(4) of the Act that covers the licenses and spectrum leases being acquired in the transaction. T-Mobile and UScellular tell the FCC their deal should be exempt from referral for Executive Branch review because: T-Mobile is subject to an agreement with an Executive Branch agency concerning national security and/or law enforcement, there are no new reportable foreign owners of T-Mobile since the effective date of that agreement, and T-Mobile agrees to continue to comply with the terms of that agreement.
The FCC agreed and is not referring the applications to the Executive Branch. Interested parties must file petitions to deny to the FCC (GN Docket No. 24-286) no later than December 9, 2024. Oppositions to the petition are due by January 8, 2025, and replies to oppositions are due January 28, 2025.
By Leslie Stimson, Inside Towers Washington Bureau Chief
Reader Interactions