T-Mobile US, Inc (TMUS  ) agreed to acquire substantially all of United States Cellular Corp's (USM  ) and Telephone and Data Systems, Inc. (TDS  ) wireless operations, including wireless customers and stores, as well as certain specified spectrum assets for $4.4 billion in the transaction in a combination of cash and up to $2.0 billion of debt.

Under the contract, T-Mobile's 5G network will expand to provide millions of US cellular customers, particularly those in underserved rural areas.

Under the deal, US cellular will retain ownership of its other spectrum and towers, and T-Mobile will enter into a long-term arrangement to lease space on at least 2,100 additional towers.

T-Mobile expects this transaction to yield $1.0 billion in effective total operating expenditure and capital expenditure annual run rate cost synergies upon integration, with the total cost to achieve the integration currently estimated at $2.2 billion - $2.6 billion.

Mike Sievert, CEO of T-Mobile. "As customers from both companies will get more coverage and more capacity from our combined footprint, our competitors will be forced to keep up - and even more consumers will benefit."

In April, T-Mobile US reported first-quarter sales of $19.59 billion, down by 0.19% year-on-year, which missed the analyst consensus of $19.81 billion.

It clocked EPS of $2.00, which beat the analyst consensus of $1.89. The company reported quarterly postpaid net account additions of 218,000.

Price Action: TMUS shares traded lower by 0.28% at $165.53 premarket at the last check Tuesday. TDS shares were up 17.2% at $22, and USM shares were trading higher by 12.80% to $48.50.