US Cellular plans special dividend of $22.50-$23.75 per share

CHICAGO - United States Cellular Corporation (NYSE:USM) announced Thursday it expects to issue a special cash dividend of $22.50 to $23.75 per share following the closing of its wireless operations sale to T-Mobile US, Inc. Parent company Telephone and Data Systems (NYSE:TDS), which maintains a remarkable 52-year streak of consecutive dividend payments according to InvestingPro, has seen its stock surge nearly 96% over the past year.

The total dividend would amount to between $1.95 billion and $2.075 billion, according to a company press release. The payment remains contingent on the transaction closing and board approval.

"We expect this to be the first of potentially several special dividends issued to shareholders as a result of our announced transactions," said Laurent Therivel, UScellular President and CEO.

The company provided a breakdown of how the $4.4 billion gross purchase price from T-Mobile would translate to distributable cash, accounting for debt repayments, tax obligations, and other adjustments.

Telephone and Data Systems, Inc. (NYSE:TDS), which owns approximately 81% of UScellular, will receive its proportional share of the special dividend.

In conjunction with this announcement, UScellular revealed plans to rename itself Array Digital Infrastructure, Inc. upon closing of the T-Mobile transaction. The company also stated that Doug Chambers will serve as interim CEO of the post-sale business.

The board is expected to set record and payment dates for the dividend at the time of declaration.

In other recent news, Telephone and Data Systems Inc. (TDS) reported disappointing first-quarter 2025 earnings, with a larger-than-expected loss and revenue shortfall. The company posted an earnings per share (EPS) of -0.09, missing the anticipated -0.01, and revenue of $1.15 billion, which fell short of the $1.17 billion forecast. In a separate development, the U.S. Department of Justice has closed its antitrust investigation into the proposed transaction between T-Mobile and UScellular, a subsidiary of TDS. This deal still requires approval from the Federal Communications Commission. Additionally, TDS announced a leadership change, with Ken Dixon appointed as the new President and CEO of TDS Telecommunications LLC, effective June 9. This follows the retirement of Jim Butman, who transitioned to a Senior Advisor role before stepping down. Moreover, UScellular, a TDS subsidiary, entered into a Fourth Amended and Restated Credit Agreement with CoBank, ACB as Administrative Agent, and other lenders, creating a direct financial obligation. Lastly, TDS disclosed a transition agreement for Mr. Butman, including a lump sum payment and other compensation details.

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