OVERLAND PARK, Kan.--(BUSINESS WIRE)--Sprint (NYSE: S) and Shentel (Nasdaq:SHEN) today announced they have amended their affiliate agreement and entered into several other agreements concurrent with Shentel entering into an agreement to acquire NTELOS Holdings Corp. (nTelos) (Nasdaq:NTLS). The related agreements call for Sprint to pay Shentel up to $252 million over approximately 5-6 years through a reduction in Sprint’s retained revenues under the affiliate agreement in consideration for spectrum, customers, and value derived from the amended Shentel affiliate relationship and related commercial terms.
Upon closing of Shentel’s purchase of nTelos, Sprint will receive nTelos spectrum assets covering 5.4 million people in parts of Virginia, West Virginia, Pennsylvania, Maryland, Ohio, Kentucky and North Carolina. Shentel will terminate the existing network wholesale agreements between Sprint and nTelos, continue to upgrade the nTelos network to 4G LTE and expand coverage in the areas with at least an additional 150 sites over the next three years, using spectrum acquired by Sprint and made available to Shentel as part of the transaction. Shentel will also be able to utilize Sprint’s 2.5 GHz spectrum within its footprint. This will provide an enhanced and more complete network for the new and existing Sprint customers.
In addition, the approximately 290,000 nTelos retail wireless customers and Sprint’s approximately 291,000 retail wireless customers in the area will be converted to Sprint-branded affiliate customers, and an additional 8,000 nTelos retail customers will be converted into Sprint- branded retail customers. It is anticipated that Sprint will transition its existing retail wireless operations within the nTelos territory to Shentel. As part of the transaction, Shentel and Sprint have also agreed to extend their affiliate relationship an additional 5 years to 2029.
“Sprint and Shentel have a long successful relationship and this announcement will only make it stronger,” said Michael C. Schwartz, Sprint senior vice president of Corporate and Business Development. “With this agreement, Sprint will grow its customer base, improve its financial performance, acquire spectrum in important markets and improve and expand 4G LTE coverage to Sprint and nTelos customers.”
Sprint expects the transaction to have a positive impact on EBITDA in the first year following the close of the agreement.
Current Sprint and Shentel customers will not be impacted by these transactions. Current nTelos customers do not need to take any immediate action. Once the transaction closes, the nTelos customers are expected to be able to continue to use their current phone, and Shentel, along with Sprint, will begin to transition the nTelos customers to the Sprint billing system and customer care services. Additional information will be communicated directly to the nTelos customers and posted to a new website, www.WelcomeToShentel.com.
The transaction is subject to customary regulatory approvals and is expected to close in early 2016.
Sprint (NYSE: S) is a communications services company that creates more and better ways to connect its customers to the things they care about most. Sprint served more than 57 million connections as of June 30, 2015 and is widely recognized for developing, engineering and deploying innovative technologies, including the first wireless 4G service from a national carrier in the United States; leading no-contract brands including Virgin Mobile USA, Boost Mobile, and Assurance Wireless; instant national and international push-to-talk capabilities; and a global Tier 1 Internet backbone. Sprint has been named to the Dow Jones Sustainability Index (DJSI) North America for the past four years. You can learn more and visit Sprint at www.sprint.com or www.facebook.com/sprint and www.twitter.com/sprint.