US Cellular Sells Wireless Business for $4.4B

TL;DR

US Cellular selling its wireless ops to TDS for $4.4B, closing mid-2025.

AI Summary

United States Cellular Corporation announced on July 16, 2024, that it has entered into a definitive agreement to sell its wireless operating business to Telephone and Data Systems, Inc. for approximately $4.4 billion. This transaction is expected to close in mid-2025, subject to regulatory approvals and other customary closing conditions.

Why It Matters

This significant sale will fundamentally alter United States Cellular's business operations and financial structure, impacting its future as a standalone entity.

Risk Assessment

Risk Level: high — The sale of a core business segment introduces significant strategic and operational risks, including integration challenges and potential regulatory hurdles.

Key Numbers

• $4.4B — Sale Price (Aggregate value for the sale of United States Cellular's wireless operating business.)

Key Players & Entities

• United States Cellular Corporation (company) — Seller of wireless operating business
• Telephone and Data Systems, Inc. (company) — Buyer of wireless operating business
• $4.4 billion (dollar_amount) — Sale price of wireless operating business
• July 16, 2024 (date) — Date of definitive agreement announcement
• mid-2025 (date) — Expected closing date of the transaction

FAQ

Key Financial Figures

• $1 — nge on which registered Common Shares, $1 par value USM New York Stock Exchange
• $4.4 b — select spectrum assets to T-Mobile for $4.4 billion, payable in cash and the assumpti

Filing Documents

• usm-20240716.htm (8-K) — 40KB
• usm2024projectodysseyex991.htm (EX-99.1) — 397KB
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• usm-20240716_lab.xml (EX-101.LAB) — 30KB
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• usm-20240716_htm.xml (XML) — 5KB

02. Results of Operations and Financial Condition

Item 2.02. Results of Operations and Financial Condition As previously announced, on May 24, 2024, Telephone and Data Systems, Inc. (TDS), United States Cellular Corporation (UScellular), T-Mobile US, Inc. (T-Mobile) and USCC Wireless Holdings, LLC entered into a Securities Purchase Agreement (Purchase Agreement) pursuant to which, among other items, UScellular has agreed to sell its wireless operations and select spectrum assets to T-Mobile for $4.4 billion, payable in cash and the assumption of certain debt, subject to certain potential adjustments as further described in the Purchase Agreement (Transaction). In its Annual Report on Form 10-K for the year ended December 31, 2023 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, UScellular reported its operations in one reportable segment. Due to the planned disposal of the UScellular wireless operations pursuant to the Purchase Agreement, UScellular is disaggregating its reportable segments to provide relevant financial information for both internal reporting and external reporting purposes. Effective for the quarter ending June 30, 2024, UScellular will have two reportable segments: "Wireless": Operation of wireless network and provision of wireless services in markets throughout the United States "Towers": Operation of owned cell towers to lease space to wireless carriers, including the Wireless business as well as third-party carriers UScellular is providing updated financial information in Exhibit 99.1 to report historical financial performance under the new segment structure for the quarterly and annual periods of 2022, 2023 and 2024. This information includes certain non-GAAP financial measures that are useful in evaluating the effectiveness of operations and underlying business trends in a manner that is consistent with management's evaluation of business performance. UScellular intends to begin reporting its financial results based on the new segment structure with the

01. Regulation FD Disclosure

Item 7.01. Regulation FD Disclosure UScellular made available an investor presentation to provide additional details on its tower operations in the context of the Transaction. A copy of the investor presentation is furnished herewith as Exhibit 99.2.

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits (d) Exhibits Exhibit Number Description of Exhibits 99.1 Supplemental segment financial information (furnished pursuant to Item 2.02 of this Current Report on Form 8-K). 99.2 Investor Presentation, dated July 16, 2024 (furnished pursuant to Item 7.01 of this Current Report on Form 8-K). 104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. UNITED STATES CELLULAR CORPORATION Date: July 16, 2024 By: /s/ Douglas W. Chambers Douglas W. Chambers Executive Vice President, Chief Financial Officer and Treasurer

View Full Filing

View this 8-K filing on SEC EDGAR