After trying and failing to acquire T-Mobile in 2011, it appears that AT&T has now set its sights on a slightly smaller target. AT&T just announced that it has agreed to buy Leap Wireless, owner of prepaid operator Cricket, for $15 per share in cash.
As part of the deal, AT&T will acquire all of Leap's stock, network assets (which includes PCS and AWS spectrum that is "largely complimentary" to AT&T's existing airwaves), retail stores, and its approximately 5 million subscribers. Leap's existing network covers 96 million people in 35 states.
If the transaction reaches completion, AT&T says that it will keep the Cricket name around and spread it to new cities while also giving its customers access to the AT&T LTE network. AT&T also plans to use Leap's spectrum to aid in its 4G LTE rollout and to increase its existing network's capacity and performance. The big blue carrier claims that this deal will result in increased competition, more device choices, better customer support, and an enhanced mobile Internet experience for Leap's customers.
As is usually the case with these deals, AT&T's acquisition of Leap Wireless is subject to federal review, which includes both the FCC and Department of Justice. AT&T expects the deal to close in 6 to 9 months.
AT&T made waves back in early 2011 when it announced plans to acquire T-Mobile for a cool $39 billion. However, the agreement faced stiff opposition from the FCC and Justice Department, and AT&T eventually decided to drop its pursuit of T-Mo. While it seems like AT&T has better odds of getting approval for this Leap purchase due to the target's smaller size, there's no guarantee that the acquisition will be okayed by regulators. It'll definitely be interesting to see how the government and third parties react to this deal, so stay tuned and I'll keep you up to date on all the latest.