AT&T agreed to buy certain wireless spectrum licenses for about $23 billion in cash from EchoStar after pressure from federal regulators on the satellite-and-wireless company.
Earlier this year, the Federal Communications Commission told EchoStar that it would investigate the company’s compliance with federal requirements to build a nationwide 5G network.
EchoStar, which owns both the Dish Network pay-TV brand and Boost Mobile’s wireless service, said in June the probe had frozen its ability to make decisions regarding its Boost business, including continued network build-out.
Shares of EchoStar surged 59% to $47.40.
EchoStar plans to use the proceeds from the transaction to retire certain debt obligations and fund its continued operations and growth initiatives, Chief Executive Hamid Akhavan said Tuesday.
“We continue to evaluate strategic opportunities for our remaining spectrum portfolio in partnership with the U.S. government and wireless-industry participants,” Akhavan said.
In June, The Wall Street Journal reported that EchoStar was considering a chapter 11 bankruptcy filing as a way to shield its cache of wireless spectrum licenses from the threat of FCC revocation.
AT&T said Tuesday the licenses cover over 400 markets across the U.S., strengthening its low-band and midband spectrum holdings.
The transaction is expected to close in mid-2026, AT&T said. The company intends to begin deploying the acquisition’s midband licenses as soon as possible.
AT&T will also have the option to lease the purchased spectrum, pending the closing of the sale, allowing for rapid deployment to U.S. consumers, EchoStar said.
The companies also agreed to update their wholesale network-services agreement, allowing Englewood, Colo.-based EchoStar to operate as a hybrid mobile-network operator providing wireless service under the Boost Mobile brand. AT&T will be the primary network-services partner to EchoStar as it continues to serve wireless customers, AT&T said.
Write to Kelly Cloonan at kelly.cloonan@wsj.com
