AT&T is in a hurry to get its hands on the fastest generation of wireless networks. This is why the telecommunications giant showed high interest in a young wireless carrier. The Straight Path Communications startup already owns a large spectrum of millimeter waves, including licenses for 39 GHz and 28 GHz. AT&T is ready to invest triple the present stock price in unlocking a new stage for 5G technology.
AT&T Is after the Young Wireless Carrier for 5G Technology
Over the past year, Straight Path Communications met a quick stock growth from $15 to $50. Last Friday, the market closed at $36.48. However, on Monday, the mobile provider made an appealing offer to the young wireless carrier. AT&T proposed an acquisition deal of $95.63 per share which is almost triple its actual worth.
The over the top deal marks the high interest of companies in top-notch products for their clients. They are ready to spend enormous funds just to be in the first line of 5G providers. This new technology can unlock higher speeds and a greater capacity, which comes to the benefit of modern consumers who want to stay connected to the online almost all the time.
The startup is a once in a lifetime product. Not anybody can build a portfolio of such type of spectrum. Their asset will allow AT&T to design the next generation of wireless networks. Straight Path is among the few organizations that own licenses of 28 GHz and 39 GHz. This resource is widely used in mobile communications.
AT&T’s Portfolio Places the Company Ahead of Verizon
The extravagant acquisition offer managed to increase the market value of Straight Path’s shares to almost $91 during afternoon trade. On the other hand, AT&T shares slipped away for just a little. The No. 1 U.S. wireless carrier, namely Verizon, is already ahead of the game. In February, the telecommunications organization acquired XO Communications and its fiber-optic networks for up to $1.8 billion. The new company offered Verizon access to millimeter wave spectrum.
With rights over Straight Path as well as FiberTower, a Wells Fargo analyst, Jennifer Fritzsche, predicted a head start of AT&T before Verizon. The portfolio of companies of AT&T has a much wider offer than that of Verizon.
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