United States Cellular Corporation (USM  ) shares are trading higher on Friday after the company agreed to sell part of its retained spectrum licenses to Verizon Communications Inc. (VZ  ) for $1.0 billion.

In particular, the company agreed to sell 663 million MHz POPs of its Cellular (850 MHz) spectrum, along with 11 million MHz POPs of AWS and 19 million MHz POPs of PCS licenses, to Verizon.

The purchase price will be paid in cash, with possible adjustments as outlined in the agreement.

Telephone and Data Systems, Inc. (TDS  ), as the 82% majority shareholder of US Cellular, has provided written consent approving the Verizon transaction.

Apart from this, the company has entered agreements with two other mobile network operators to sell other selected spectrum licenses.

United States Cellular plans to sell 12 million MHz POPs of its spectrum licenses in the CBRS, C-Band, and 700 MHz B/C Block bands to two other mobile network operators.

These deals are subject to regulatory approval and customary closing conditions, though the buyers and terms remain undisclosed.

After these transactions, US Cellular will retain 3.4 billion MHz POPs of low and mid-band spectrum (700 MHz, 3.45GHz, CBRS, and C-Band) and 17.2 billion MHz POPs of mmWave spectrum.

These transactions align with the company's plan to monetize spectrum not included in the proposed sale to T-Mobile US, Inc. (TMUS  ).

Each of these transactions is contingent upon the successful closing of proposed sale to T-Mobile.

Notably, in May 2024, T-Mobile US agreed to acquire substantially all of the United States Cellular and 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.

Verizon ended the first half of 2024 with a free cash flow of $8.5 billion.

Price Action: USM shares are up 11.9% at $65.71 at the last check Friday.