T-Mobile, Metronet Seeks FCC Merger Approval

WASHINGTON, Aug 11, 2024 – T-Mobile last week took the next step toward expanding beyond wireless and establishing a foothold as a major provider of fiber-based communications to millions of U.S. homes, including underserved communities.

In a new filing with the Federal Communications Commission, T-Mobile sought approval for its $4.9 billion acquisition of Metronet, a regional fiber provider across 21 states, in a joint venture with private equity giant KKR controlled by famed investors Henry Kravis and George Roberts. The transactions, unveiled on July 24, was the second of its kind involving T-Mobile since April.

“T-Mobile will be the anchor tenant on the fiber and will leverage its brand to attract new subscribers,” the companies said in an Aug. 8 filing that appeared on the FCC’s website a day later. "The proposed transaction will serve the public interest by preserving and enhancing [Metronet's] strengths without posing any threat of anticompetitive effects or other public interest harm, as well as being entirely transparent to consumers."

Indiana-based Metronet currently passes more than 2 million homes and businesses with its all-fiber network. With T-Mobile’s financial backing, the T-Mobile-KKR JV has plans to extend Metronet’s reach to 6.5 million homes passed by the end of 2030. 

“Metronet plans to improve and expand the fiber network …, making high-capacity fiber connections available to more consumers and bringing increased competition to [its] existing footprint,” the FCC filing said.

T-Mobile and Metronet said in general terms they expect the deal to "aid in the deployment of broadband to underserved communities who do not have access to fiber today."

In April, T-Mobile disclosed a joint venture with EQT to acquire fiber-to-the-home provider Lumos, which has built out its network in communities in Virginia, North Carolina, and South Carolina. In announcing the deal, T-Mobile said it would invest about $950 million in the JV to acquire a 50% equity stake and all existing Lumos fiber customers.

With an additional $500 million invested between 2027 and 2028, T-Mobile said it had plans to expand Lumos's fiber footprint to 3.5 million homes passed by the end of 2028, up from 320,000 today.

The T-Mobile-Metronet filing did not discuss potential harms to competition, including to what extent T-Mobile’s fixed wireless access service competes with Metronet for broadband subscribers.

T-Mobile, claiming ownership of the largest and fastest 5G network in the U.S., offers its Home Internet fixed wireless service over the same 5G network to more than 50 million U.S. homes. T-Mobile is the leading fixed wireless provider, adding 5.6 million subscribers since launching in 2021.

"Importantly, the proposed transaction will not eliminate any telecommunications service provider and therefore does not pose any threat of anticompetitive effects in connection with any telecommunications service," the filing said. "The deal will not cause any diminution in competition."