NextWave Telecom Inc. is reportedly close to an agreement to sell approximately 20 percent of its recently recovered spectrum licenses to Cingular Wireless L.L.C. for nearly $1.5 billion.
While neither NextWave nor Cingular are commenting on the rumored deal, published reports note executives close to the negotiations claim the sale would not include spectrum licenses in New York City, where NextWave currently controls a 30-megahertz C-block license and Cingular recently launched service through a network sharing agreement with T-Mobile USA Inc.
During the Federal Communications Commission’s previous attempt to auction NextWave’s licenses in early 2001, Cingular bid more than $2.3 billion through its Salmon PCS L.L.C. bidding partner for 79 licenses covering approximately 72 million potential customers.
Analysts noted the rumored deal between NextWave and Cingular would be priced slightly higher per pop than the $1.60 per pop Verizon Wireless recently paid to acquire wireless licenses from NorthCoast PCS, but it would be well below the nearly $3 per pop Cingular was willing to pay during the FCC’s auction.
In addition to providing Cingular with spectrum licenses to fill in a number of coverage gaps in its nationwide footprint, the proposed deal would provide NextWave with much-needed cash to begin paying down the more than $4 billion it currently owes the federal government for the licenses.
The agreement also comes weeks after the FCC announced plans to allow spectrum license owners to lease or trade licenses if they are not using the spectrum.
