AT&T is spending $780 million in cash to scoop up more wireless spectrum.
The company announced Tuesday that it is buying the U.S. retail wireless operations of a carrier called Atlantic Tele-Network or ATNI. As part of the deal, AT&T will acquire wireless spectrum licenses, network assets, retail stores and approximately 585,000 subscribers.
ATNI operates under the Alltel name in the U.S. Its network covers roughly 4.6 million in rural areas in six states including, Georgia, Idaho, Illinois, North Carolina, Ohio, and South Carolina.
The spectrum licenses that AT&T is acquiring are in the 700MHz, 850MHz, and 1900MHz band. AT&T uses 700MHz for its 4G LTE network and it uses 850MHz and 1900MHz for its 2G and 3G networks.
The transaction must still be approved by regulators, including the Federal Communications Commission and the Department of Justice. AT&T said in its press release that it expects the deal to close in the second half of 2013.
AT&T has been on the hunt for wireless spectrum as it looks to expand its 4G LTE network and keep up with demand on its 3G HSPA+ network. In 2011, the company tried to buy No. 4 wireless carrier T-Mobile in a deal that was worth $39 billion. But regulators put the kibosh on those plans. AT&T was left with a hefty breakup fee for failing to get the deal done. And it was also without the additional spectrum it told the FCC and others it desperately needed from T-Mobile.
Since then, the carrier has stayed away from bigger deals and instead has focused on smaller spectrum acquisitions. In 2012, AT&T entered into more than 40 spectrum deals. At an investor conference in November, the company's executives said they were in good shape when it comes to spectrum, but they seem to still need more.
"In the near term we've taken an opportunistic approach," John Stankey, AT&T's chief strategy officer said at the time. "These deals give us confidence that we can meet our LTE objectives for next two years and they will allow us to deliver competitive performance."