AT&T Acquires Straight Path, Dish Stock Rises – Investor's Business Daily

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AT&T (T) has agreed to acquire Straight Path Communications (STRP) for $1.25 billion, gaining high-frequency airwaves in the 28 GHz and 39 GHz millimeter wave band.

The acquisition could be tied to AT&T’s plans to provide 5G wireless services, analysts say. In the 39 GHz band, Straight Path owns spectrum in the 40 largest markets across the U.S., including New York City, Los Angeles, San Francisco, Washington, D.C. and Atlanta.

AT&T agreed to pay $95.63 per share, a nearly 60% premium over Straight Path’s closing price of 36.48 on Friday. AT&T stock edged down a fraction to 40.43 in the stock market today.

Shares in satellite broadcaster Dish Network (DISH), which has cobbled together nearly 80 MHz of mid-band spectrum, climbed Monday following the AT&T-Straight Path deal.

Dish has been looking for a wireless partner. Macquarie Securities, in a report on Monday, said T-Mobile US (TMUS) parent Deutsche Telekom (DTEGY) could be interested in acquiring Dish Network to boost its mobile video strategy.

Including Straight Path liabilities, the deal has a total value of $1.6 billion, the companies said. The companies anticipate a closing within 12 months, subject to Federal Communications Commission review.

AT&T is awaiting government approval of its $85 billion acquisition of media giant Time Warner (TWX). That deal was announced in late October.

IBD’S TAKE: Shares in AT&T are down about 4.5% in 2017. Rising interest rates are negative for high-dividend paying stocks, such as AT&T. Research other options at The Income Investor.

Verizon Communications (VZ) in 2016 agreed to buy privately held XO Communications’ fiber-optic network for about $1.8 billion. The purchase included rights to lease XO’s high-frequency wireless spectrum in the 28 to 31 GHz bands, with an option to buy for $200 million, by year-end 2018.


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