AT&T Just Made a Smart $23 Billion Bet
Telecom giant AT (NYSE: T) struck a deal with on Tuesday to acquire wireless spectrum licenses that cover nearly ever market across the U.S. The company will pay $23 billion for 30 MHz of mid-band spectrum and 20 MHz of low-band spectrum. AT plans to deploy these licenses as soon as possible, bolstering its 5G network. The transaction is expected to close in mid-2026.
AT will finance this hefty deal with a combination of cash on hand and additional borrowings. The company's net-debt-to-adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) ratio will increase as a result, but AT expects to be back AT its target level within about three years. This deal won't impact AT's capital return plans, which include $20 billion for share repurchases through 2027.
Why is AT spending so much on additional spectrum? It's all about the company's convergence strategy.
Source Fool.com
