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New arena at Will Rogers takes shape


The proposed Will Rogers Memorial Center arena continues to take shape as voters head for a Nov. 4 election to decide whether to approve new taxes to help pay for the $450 million facility.

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Cooking Class: Fort Worth chef brings home the gold

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Fort Worth firm 'simplifies' advertising

Reaching customers requires more than price slashing and flashy ads. In today’s competitive marketplace, machines – not men and women – are essential to tapping new markets and

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Trinity Valley School leader to leave in May 2015

Gary Krahn, head of school for the past eight years at Trinity Valley School in Fort Worth, will leave his position in May 2015 when he and his wife Paula will move

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RadioShack rescue raises question of what's worth saving

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AT&T to buy Leap Wireless for about $1.2 billion

 

RYAN NAKASHIMA,AP Business Writer

 

 LOS ANGELES (AP) — AT&T Inc. said Friday that it has agreed to acquire Leap Wireless International Inc., the pre-paid cellphone carrier that operates under the Cricket brand, for about $1.19 billion in cash, or $15 a share.

The purchase gives the nation's No. 2 cellphone carrier a leg-up in serving customers who prefer not to have lengthy contracts. Leap's Cricket service has 5 million subscribers who pay monthly without a contract. The deal also gives AT&T the right to use Leap's unused airwaves — also known as spectrum — to expand its network.

Spectrum is the lifeblood of the wireless industry and the fight to grab more of it has spurred a recent wave of consolidation.

In April, No. 4 T-Mobile completed its acquisition of pre-paid carrier MetroPCS. The company plans to shut down the MetroPCS network in two years, so it can use the airwaves to improve coverage and data speeds. On Wednesday, Japan's SoftBank Corp. completed its $21.6 billion takeover of No. 3 Sprint Corp, which helped Sprint acquire Clearwire Corp. and its spectrum holdings a day earlier.

Charles Golvin, a technology analyst with research firm Forrester, said Leap's spectrum holdings will allow AT&T to offer more of its customers faster, more reliable wireless data in congested areas.

"Having more spectrum means having more capacity and being able to meet those long-term data demands," Golvin said. "Just like you can never be too thin or too pretty, you can never have too much spectrum."

As part of its deal, AT&T plans to keep the Cricket brand name, but provide Cricket customers with a broader range of devices and give them access to AT&T's "4G LTE" high-speed wireless network. AT&T says it plans to expand Cricket's presence in the U.S.

As of March, AT&T had 7.1 million pre-paid customers through its GoPhone and Aio brands. AT&T has 107 million wireless customers in total.

"The pre-paid market for us is relatively untapped," said AT&T spokesman Brad Burns. "From a competition perspective, this creates a much healthier competitor in the pre-paid space."

AT&T will buy all of Leap's stock and wireless properties, including licenses, network and retail stores. Leap's unused spectrum covers portions of the country that include 41 million people.

The companies said owners of nearly 30 percent of Leap shares have agreed to vote in favor of the deal.

Leap shares skyrocketed in after-hours trading on the news, more than doubling to $17.31, well past the offer price. The stock's movement suggests the market believes a higher bid will emerge. AT&T shares slipped a penny to $35.80.

Leap, based in San Diego, had $2.8 billion of debt.

The nation's sixth-ranked carrier had been struggling. In the quarter through March, Leap's net loss expanded to $110 million as it lost a net 93,000 wireless customers. Its revenue in the same period declined 12 percent from a year ago to $685 million.

"Senior management looked at (the acquisition by AT&T) as our best path forward for the company's long-term success," Leap spokesman Greg Lund said.

Cricket is considered a regional carrier. Its network covers regions of the country housing 96 million people in 35 states. It also provides national coverage through a roaming agreement with Sprint, which won't be needed if its tie-up with AT&T gains regulatory approval.

Cricket phones are also sold outside its own coverage area in the U.S. through Radio Shack and Walmart stores.

AT&T said it expects the deal will close in six to nine months, although it requires approval from the Federal Communications Commission and Department of Justice.

Federal regulators have been averse to permitting larger carriers to merge.

In late 2011, AT&T abandoned its $39 billion bid to buy T-Mobile after the Justice Department raised its objection to the deal on the grounds it would raise prices and give customers fewer choices.

Free Press, a media and technology watchdog organization in Washington, registered its opposition to this latest deal.

"This is (a) smaller deal, but AT&T is sure to make the same false claims it tried with T-Mobile," Free Press CEO Craig Aaron said in a statement. "This takeover would result in fewer choices, higher prices and job losses."


 

 

The Associated Press

 

 


The two largest wireless carriers, Verizon Wireless and AT&T, have been trying to bolster their spectrum holdings, while the next largest, Sprint and T-Mobile, have been seeking to make alliances to compete better. Here's a look at the merger and acquisition activity in the telecommunications industry since last summer:

— June 26, 2012: Verizon Wireless agrees to sell some airwave rights to T-Mobile and swap others.

— Aug. 2: AT&T Inc. announces three deals aimed at boosting its spectrum holdings. They are with Comcast Corp., NextWave Wireless Inc. and Horizon Wi-Com.

— Aug. 24: A consortium of cable companies sell their spectrum holdings to Verizon Wireless for $3.6 billion.

— Oct. 3: T-Mobile USA's parent company, Deutsche Telekom AG of Germany, agrees to buy MetroPCS Communications Inc. and merge T-Mobile into it.

— Oct. 11: Japan's Softbank Corp. agrees to pay $20.1 billion for 70 percent of Sprint Nextel Corp., providing a much-needed cash boost for the struggling carrier.

— Nov. 11: Sprint Nextel Corp. agrees to buy some U.S. Cellular Corp. service areas in the Midwest for $480 million.

— Dec. 13: Sprint agrees to buy out the minority shareholders of wireless network operator Clearwire Corp., of which it already owns a majority.

— Jan. 22, 2013: AT&T agrees to buy remnants of the Alltel network for $780 million.

— Jan. 25: Verizon Wireless agrees to sell some spectrum rights to AT&T for $1.9 billion and swap some others.

— April 30: T-Mobile completes acquisition of MetroPCS and becomes T-Mobile US Inc. T-Mobile adds 9 million MetroPCS customers to its own 34 million. T-Mobile plans to shut down MetroPCS's network over two years, freeing up space on the airwaves to improve its own coverage and data speeds.

— July 9: Sprint completes acquisition of Clearwire.

— July 10: Softbank completes Sprint deal, now worth $21.6 billion for a 78 percent stake. It comes after Softbank boosts its offer and satellite TV operator Dish Network Corp. abandons its $25.5 billion bid to buy Sprint in its entirety. As part of the new ownership, Sprint Nextel is changing its name to Sprint Corp.

— July 12: AT&T says it will acquire Leap Wireless, the service provider of pre-paid, contract-free plans under the Cricket brand, for about $1.19 billion in cash. The purchase gives the nation's second largest cellphone carrier a leg-up in serving customers who prefer not to have lengthy contracts. It also would give AT&T the right to using Leap's unused airwaves in expanding its existing network.

 

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