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T-Mobile Seeks to Bolster Fiber Offerings with $4.9 Billion Metronet Acquisition

By  |  July 24, 2024

T-Mobile, the nation’s second-largest wireless carrier, is broadening its horizons with a strategic move to acquire Indiana-based fiber internet provider Metronet. This $4.9 billion deal is poised to significantly expand T-Mobile’s fiber footprint, complementing its ongoing $4.4 billion acquisition of US Cellular, a major play to enhance its wireless services.

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    In a press release issued on Wednesday, T-Mobile detailed its plans to partner with the investment firm KKR in this venture. The acquisition will bring Metronet’s 2 million customers, spanning 17 states, under T-Mobile’s wing while allowing Metronet to continue its operations as a wholesale provider. T-Mobile projects that Metronet’s customer base will surge to approximately 6.5 million by 2030. The transaction is expected to be finalized in 2025.

    KKR is already a minority investor in Metronet. Oak Hill Capital and the family of Metronet’s founder, John Cinelli, will retain minority stakes in the joint venture, ensuring continuity and stability for the broadband company.

    Read more: Judge Orders T-Mobile to Face Suit Alleging Anti-Competitive Practices

    This acquisition bid arrives amidst heightened regulatory scrutiny. This same week, Democratic Senators Elizabeth Warren of Massachusetts and Amy Klobuchar of Minnesota, along with four other senators, urged the Justice Department to closely examine the implications of T-Mobile’s US Cellular acquisition. The senators expressed concerns that the merger could potentially lead to higher prices and fewer choices for consumers. They also called for a review of T-Mobile’s previous acquisition of Sprint.

    T-Mobile’s aggressive expansion strategy underscores its ambition to become a dominant player not only in the wireless sector but also in the fiber internet market. With the dual acquisitions of US Cellular and Metronet, T-Mobile is poised to deliver more comprehensive service offerings to its customers, enhancing connectivity options across the United States.

    Source: T-Mobile