The US has raised a record US$44.9bn from its AWS-3 spectrum auction after 341 rounds of bidding in about two and a half months. The final price roughly doubles analyst expectations, with the auction smashing through its US$10.1bn reserve in the first…
The US has raised a record US$44.9bn from its AWS-3 spectrum auction after 341 rounds of bidding in about two and a half months.
The final price roughly doubles analyst expectations, with the auction smashing through its US$10.1bn reserve in the first week of bidding back in November.
Shares in DTH giant Dish Network, which already owned similar mid-band spectrum to AWS-3, jumped 2.73% yesterday to close at US$73.48.
Dish was also registered to bid in the auction; however, New Street Research analyst Jonathan Chaplin said the result supports a value for the group of at least US$127 per share, irrespective of how much it spent.
Although the FCC regulator has yet to unveil the winning bidders, Chaplin said telco AT&T is likely to have spent the most because of its recent debt financings.
AT&T, which is in the middle of buying Dish’s main DTH rival DirecTV, secured two loan credit agreements last week worth a total US$11.2bn with Mizuho as administrative agent.
Yesterday, it priced a 4.6% US$2.62bn bond due 2045 at par, with the proceeds to be used for general corporate purposes including acquisition related payments. Morgan Stanley was the coordinator for that deal.
Local telcos Verizon and T-Mobile are also expected to have made significant bids in the AWS-3 auction.
The FCC had certified a total of 70 acquisition vehicles to take part in the sale.
As well as Dish, the high price for AWS-3 could also be a boost for US satellite/terrestrial venture LightSquared, although it is still looking to make use of its frequencies after they were found to interfere with GPS technology.
The country’s next spectrum auction is set to take place in 2016, when it will sell 600 MHz broadcast TV frequencies.
Meanwhile, Canada’s government has plans to auction similar AWS-3 airwaves in March.