24/7 Wall St.

The number three U.S. wireless carrier, Sprint Nextel Corp. (NYSE: S) announced this morning that it has agreed to pay $480 million to United States Cellular Corp. (NYSE: USM) for additional wireless spectrum and customers in Illinois, Indiana, Michigan, Missouri and Ohio. Sprint gets 20 MHz of PCS (Personal Communications Services) spectrum in the 1900 MHz band in a number of Midwestern markets, including Chicago; Champaign, Ill.; and South Bend, Ind., as well as 10 MHz of PCS spectrum in St. Louis.

The sale is subject to regulatory approval and Sprint said it expects the deal to close in mid-2013.

Sprint’s CEO said:

This transaction will enable us to strengthen our business and become a more robust competitor. Acquiring this spectrum will significantly increase Sprint’s network capacity and improve the customer experience in several important Midwest markets including Chicago and St. Louis. We welcome the new customers in these markets and look forward to providing them with Sprint’s unique combination of unlimited plans, an iconic device portfolio and unmatched customer service.

Sprint will use the additional spectrum to add to its coverage “as it continues to deploy its Network Vision upgrade and roll out 4G LTE nationally.”

This is Sprint’s first transaction since the company agreed to a sale of a majority interest in the company to Japan’s SoftBank. The cash must be burning a hole in Dan Hesse’s pockets.

Sprint’s shares are down about 1% in premarket trading this morning, at $5.67 in a 52-week range of $2.10 to $6.04.

Paul Ausick