Cingular deals for more spectrum

While it waits to find out if its bid to buy spectrum licenses for 34 markets from NextWave Telecom survives bankruptcy court, Cingular Wireless hasn’t stopped buying spectrum assets. The mobile giant announced this week that it will acquire spectrum and other operations valued at $27.6 million from US Unwired, a financially troubled Sprint PCS affiliate.

The spectrum being dealt covers markets in Texas, Arkansas and Louisiana, including US Unwired's hometown cellular network in Lake Charles, La.; 10 MHz of its PCS spectrum in Alexandria and Shreveport, LA; Longview and Paris, Texas; and Texarkana, Texas/Arkansas. Cingular currently provides service in all of those markets except Texarkana.

The agreement is expected to close in the fourth quarter of this year. It is subject to the consent of the Federal Communications Commission, as well as consents and releases from US Unwired's senior credit lenders.

The deal will leave US Unwired with operations in five markets. The company recently warned that it might not meet some of its financial covenants, and also has filed a lawsuit against Sprint PCS accusing the national carrier of violating the terms of its affiliate program. Despite these conditions, US Unwired said this week that it would continue to operate as a Sprint PCS affiliate.

Cingular, which will pay for the US Unwired assets in cash, has submitted a $1.4 billion proposal to acquire NextWave spectrum. Any competing bids from other carriers were due to be filed this week.