Verizon out-bids AT&T for Straight Path, acquiring “5G” spectrum, for $3.1B


Verizon Communications Inc. (NYSE: VZ) announced it has signed an agreement to acquire Straight Path Communications Inc. (NYSE: STRP) and with it, the valuable mmWave spectrum Straight Path owns. Verizon out bid AT&T (NYSE: T) in what had turned into an unexpected bidding war for the company with 9 full time employees. The final bid was $3.1 Billion in an all-stock transaction. Verizon agreed to pay $184.00 per share for Straight Path stock, which had traded just over one month prior for less than $35 per share. The carrier plans to utilize their newly acquired spectrum in future 5G developments.

“Verizon now has all of the pieces in place to quickly accelerate the deployment of 5G,” said Hans Vestberg, executive vice president and president of global network and technology at Verizon. “Combined with our recent transactions with Corning Incorporated, XO Communications, and Prysmian Group, this is another step to build the next-generation network for our customers.”

Straight Path holds an extensive portfolio of 39 GHz spectrum licenses throughout the nation and 28 GHz licenses in major markets. The company originally acquired the licenses for around $56 million in 2001 and 2002 from Winstar Communications, which had filed for bankruptcy protection.

Verizon will pay on behalf of Straight Path a termination fee of $38 million to AT&T, which was already in advanced acquisition talks when Verizon entered the bidding process.

The transaction is anticipated to close within nine months, subject to FCC review.



About Jesse Petrilla

Recommended for you