To strengthen its network in a cutthroat industry, AT&T said on Tuesday that it will pay roughly $23 billion to acquire important wireless spectrum licenses from EchoStar.
According to the firm, President Donald Trump urged Federal Communications Commission Chair Brendan Carr and satellite communications and Dish TV parent company EchoStar to come to a friendly agreement in June on the company’s cellular spectrum licenses.
The agreement is AT&T’s most recent significant investment to speed up the rollout of its fiber and 5G networks as the wireless market becomes saturated and internet demand rises.
AT&T saw a 1.5% increase in premarket trade, while EchoStar’s shares surged almost 40%.
The FCC questioned EchoStar’s buildout extension and mobile-satellite service in May and informed the firm that it was looking into the company’s compliance obligations to offer 5G service in the US.
Trump called Carr to participate in the June 12 meeting with EchoStar Chair Charlie Ergen.
EchoStar had been attempting to protect its collection of wireless spectrum licenses from the possibility of FCC revocation.
The AT&T agreement, according to EchoStar, is part of its ongoing efforts to address the FCC’s questions.
EchoStar CEO Hamid Akhavan stated, “This transaction puts our business on a solid financial path, further facilitating EchoStar’s long-term success and enhancing our ability to innovate and compete as a hybrid network operator.”
The company is still assessing strategic opportunities for its remaining spectrum portfolio.
Due to an unsuccessful debt-exchange offer, U.S. satellite TV company DirecTV ended its deal to buy EchoStar’s satellite television division last year, which includes competitor Dish TV.
For $5.75 billion in cash, AT&T closed a deal in May to purchase Lumen Technologies’ consumer fiber operations.
Customers have responded favorably to AT&T’s bundled plans, which combine high-speed fiber with mobile products, even as competitors like Verizon and T-Mobile increase their marketing efforts.
Between April and June, the corporation added 401,000 net monthly bill-paying wireless phone users.
According to the business, the licenses will bolster AT&T’s holdings of low-band and mid-band spectrum spanning more than 400 markets nationwide.
To enable EchoStar to function as a hybrid mobile network operator offering wireless service under the Boost Mobile brand, the businesses also decided to extend their network services agreement.
The main network partner will be AT&T.
Additionally, AT&T reaffirmed its financial guidance for 2025 and stated that it plans to use cash on hand and incremental borrowings to finance the spectrum purchase.
