Jan 6 (Reuters) - T-Mobile US Inc said on Monday itwould buy spectrum licenses from Verizon Wireless to improve itshigh-speed wireless services in a deal worth $3.3 billion.
T-Mobile, majority owned by Deutsche Telekom,said the deal includes $2.365 billion in cash and a transfer ofspectrum worth $950 million.
It had been raising money to buy more airwaves as it beefsup its network to catch up with rival services.
Reuters reported in November that T-Mobile was seeking tobuy the spectrum from Verizon Wireless, owned by VerizonCommunications Inc and Vodafone Group Plc.
T-Mobile, the No. 4 U.S. mobile provider, said the licensescover more than 150 million people in areas such as New York,Atlanta and Los Angeles. It expects to roll out services usingthe spectrum as early as the fourth quarter of 2014.
It said that the transaction, which requires regulatoryapproval, is expected to close around the middle of 2014.
T-Mobile had raised $1.8 billion through a sale of itscommon stock in November and sold about $2 billion in bonds tofund future spectrum purchases.
Wells Fargo analyst Jennifer Fritzsche said the spectrumwould boost T-Mobiles network capacity and coverage, butestimated that it could cost another $1 billion to add spectrumto its network.
T-Mobile also said the companies will realign spectrumblocks in markets such as northern California and Atlanta.
Verizon Wireless said last year it would consider sellingunused A Block airwaves in the 700 megahertz frequency band thatT-Mobile has now agreed to buy. It had tried to sell thespectrum in 2012.
TAP Advisors was the financial adviser for T-Mobile.
T-Mobile shares were up 0.7 percent at $32.50 in premarkettrading. Verizon shares rose 0.5 percent to $48.65.
Vodafone (VOD)