T-Mobile's scalable broadband and wireless growth engine
combined with EQT's infrastructure expertise will leverage Lumos'
fiber platform to deliver broadband services to more
Americans
BELLEVUE, Wash. and
NEW YORK, April 25, 2024 /PRNewswire/ -- T-Mobile (NASDAQ:
TMUS), America's 5G leader and fastest growing broadband provider,
and EQT, a purpose-driven global investment organization, today
announced they have entered into a joint venture (JV) with EQT's
Infrastructure VI fund (EQT) that will acquire fiber-to-the-home
platform Lumos from EQT's predecessor fund EQT Infrastructure
III.
The JV will bring T-Mobile's retail, marketing, brand and
customer experience strengths together with EQT's fiber
infrastructure investment expertise. Together they will acquire
Lumos' scalable fiber network build capabilities to deliver
best-in-class high-speed fiber internet connectivity to customers
across the U.S. without access to fiber today. After the
transaction closes, Lumos, which currently reaches
320,000 households over 7,500 route miles with fiber optic internet
and home wi-fi service in the Mid-Atlantic, will transition to
a wholesale model with T-Mobile as the anchor tenant owning
customer relationships and leveraging its brand to attract new
subscribers. The JV will focus on market identification and
selection, network engineering and design, network deployment, and
customer installation.
"As the demand for reliable, low-latency connectivity rapidly
increases, this deal is a scalable strategy for T-Mobile to take a
significant step forward in expanding on our broadband success and
continue shaking up competition in this space to bring even more
value and choice to consumers," said Mike
Sievert, CEO of T-Mobile. "Together with EQT and Lumos,
T-Mobile is building on our position as the fastest growing
broadband provider in the country in a value-accretive way that
complements our sustained growth leadership in wireless. Customers
– homes and businesses – who get the fast, affordable, and reliable
internet they need will be the real winners."
T-Mobile provides a unique value proposition and much-needed
reliable connectivity to homes and businesses across the country
through its 5G Internet, a fixed wireless internet service on its
5G network that is available to more than 50 million households and
businesses nationwide and serves over 5 million customers, as well
as T-Mobile Fiber, which has launched in parts of 16 U.S. markets.
Those launches have shown consumer demand for broadband that
T-Mobile cannot meet through its fallow capacity fixed wireless
product alone, and many customers want the speed and reliability
that only fiber can provide.
Jan Vesely, Partner within EQT's
Infrastructure Advisory Team said, "We are proud to have partnered
with Lumos over the past six years to rapidly scale the company and
roll out fiber to underserved markets, and we look forward to
continuing to leverage EQT's considerable digital infrastructure
and fiber expertise to support the significant fiber buildout
ambitions of T-Mobile and the JV. This new effort will build
critical fiber broadband infrastructure that will enable remote
work, education, and healthcare use cases across the country. We
have worked with T-Mobile as a customer across many of our existing
digital infrastructure investments and are delighted to build on
that relationship and partner with T-Mobile on this opportunity to
roll out fiber to underserved Americans."
"Lumos takes great pride in our achievements, as we have
successfully delivered fiber to hundreds of thousands of homes and
businesses, marking a significant acceleration in our growth. Our
commitment to enhancing customers' lives through the development of
a network prepared for the demands of tomorrow remains steadfast,"
Brian Stading, CEO of Lumos. "With
the support of our private equity partner, EQT, and leveraging the
strength of the T-Mobile brand and unrivaled customer experience,
Lumos is set to expedite our network expansion. This joint venture
will amplify our ability to change lives through the
transformative power of fiber optic internet."
The transaction is expected to close in late 2024 or early 2025,
subject to customary closing conditions and regulatory approvals.
At closing, T-Mobile is expected to invest approximately
$950 million in the JV to acquire a
50% equity stake and all existing fiber customers, with the funds
invested by T-Mobile being used by Lumos for future fiber builds.
The next capital contribution by T-Mobile out of an additional
commitment of approximately $500
million is anticipated between 2027 and 2028. These combined
investments are expected to allow Lumos to reach 3.5 million homes
passed by the end of 2028. T-Mobile continues to expect to complete
its remaining authorization for share repurchases and dividends in
2024.
With this transaction, EQT Infrastructure VI is expected to be
35-40% percent invested (including closed and/or signed
investments, announced public offers, if applicable, and less any
expected syndication) based on target fund size and subject to
customary regulatory approvals.
Cautionary Statement Regarding Forward-Looking
Statements
This communication contains certain forward-looking
statements concerning T-Mobile and the proposed transaction with
EQT to acquire regional fiber company Lumos. All statements other
than statements of fact, including information concerning future
results, are forward-looking statements. These forward-looking
statements are generally identified by the words "plan,"
"anticipate," "believe," "estimate," "expect," "intend," "may,"
"could" or similar expressions. Such forward-looking statements
include, but are not limited to, statements about the benefits of
the proposed transaction, including anticipated future financial
and operating results, T-Mobile's and the joint venture's
objectives, expectations and intentions, the accounting treatment
of the proposed transaction, and the expected timing of completion
of the proposed transaction. There are several factors which could
cause actual plans and results to differ materially from those
expressed or implied in forward-looking statements. Such factors
include, but are not limited to, the failure to satisfy any of the
conditions to the proposed transaction on a timely basis or at all;
the occurrence of events that may give rise to a right of one or
both of the parties to terminate the definitive agreements; adverse
effects on the market price of T-Mobile's common stock
and on T-Mobile's operating results because of a failure to
complete the proposed transaction in the anticipated timeframe or
at all; negative effects of the pendency or consummation of the
proposed transaction on the market price of T-Mobile's common stock
and on T-Mobile's operating results; the risk of litigation or
regulatory actions; and other risks and uncertainties
detailed in T-Mobile's Annual Report on Form 10-K for the fiscal
year ended December 31, 2023, including in the sections thereof
captioned "Risk Factors" and "Cautionary Statement Regarding
Forward-Looking Statements," as well as in its subsequent reports
on Form 8-K and Form 10-Q, all of which are filed with the SEC and
available at www.sec.gov and www.t-mobile.com. Forward-looking
statements are based on current expectations and assumptions, which
are subject to risks and uncertainties that may cause actual
results to differ materially from those expressed in or implied by
such forward-looking statements. Given these risks and
uncertainties, persons reading this communication are cautioned not
to place undue reliance on such forward-looking statements.
T-Mobile assumes no obligation to update or revise the information
contained in this communication (whether as a result of new
information, future events or otherwise), except as required by
applicable law. References to our and the SEC's website are
inactive textual references only. Information contained on our and
the SEC's website is not incorporated by reference in this
communication and should not be considered to be a part of this
communication.
Legal Disclaimer
The information contained herein does not constitute an offer to
sell, nor a solicitation of an offer to buy, any security, and may
not be used or relied upon in connection with any offer or
solicitation. Any offer or solicitation in respect of EQT
Infrastructure VI will be made only through a confidential private
placement memorandum and related documents which will be furnished
to qualified investors on a confidential basis in accordance with
applicable laws and regulations. The information contained herein
is not for publication or distribution to persons in the United States of America. Any securities
referred to herein have not been and will not be registered under
the U.S. Securities Act of 1933, as amended (the "Securities Act"),
and may not be offered or sold without registration thereunder or
pursuant to an available exemption therefrom. Any offering of
securities to be made in the United
States would have to be made by means of an offering
document that would be obtainable from the issuer or its agents and
would contain detailed information about the issuer of the
securities and its management, as well as financial information.
The securities may not be offered or sold in the United States absent registration or an
exemption from registration.
Advisors
Citigroup Global Markets Inc. is serving as T-Mobile's exclusive
financial adviser for the transaction.The Bank Street Group and
Simpson Thacher & Bartlett LLP were exclusive advisors to Lumos
and EQT Infrastructure III for the transaction.
Kirkland & Ellis LLP, JP Morgan, and Goldman Sachs & Co.
LLC advised EQT Infrastructure VI for the transaction.
T-Mobile US, Inc. Media Relations
MediaRelations@t-mobile.com
T-Mobile Investor Relations Contact
investor.relations@t-mobile.com
https://investor.t-mobile.com
EQT Press Office
press@eqtpartners.com
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