Here's Why Straight Path (STRP) Stock Skyrocketed 30% Today
Shares of Straight Path Communications Inc. STRP soared on Monday morning amid news that it has received another massive anonymous buyout offer as the war to buy the wireless spectrum holding company ratchets up once again.
The new, all-stock offer from an unknown bidder is reportedly worth $184 per share, which would value Straight Path at nearly $3.1 billion. Straight Path’s stock jumped 32.29% to $213.64 per share in morning trading on Monday, shortly after initial reports surfaced.
According to Reuters, Verizon Communications Inc VZ is the unidentified telecommunications giant looking to buy the wireless spectrum power.
Monday’s bid comes roughly a month after AT&T Inc T offered to buy Straight Path for $1.25 billion, which, at the time, marked a 160% premium. The bidding war officially started on April 25 when the company announced it received a “superior” offer. It is still unclear where that offer came from. Straight Path said the new bidder would pay AT&T its $38 million termination fee that was part of the initial buyout deal.
If Verizon actually is the anonymous bidder, it looks like the two largest U.S. wireless carriers are ready to duel it out over Straight Path as the race towards 5G intensifies.
Straight Path is one of the largest holders of 28 GHz and 39 GHz spectrum in the U.S., which are both included in the FCC’s designation for the next generation of wireless broadband services known as “5G.” Straight Path holds the rights to 868 spectrum licenses in total.
In its initial buyout statement, AT&T announced: “The acquisition will support AT&T's leadership in 5G, which will accelerate the delivery of new experiences for consumers and businesses like virtual and augmented reality, telemedicine, autonomous cars, smart cities and more.”
The bidding war has sent Straight Path’s stock on a massive uptick over the last month. As of April 3, the company’s stock was trading at $36.48 per share. Shares of Straight Path closed at $161.49 on Friday, and the company’s stock continues to rise on Monday.
If you want to know more about the 5G Race, check out our guide: Here's How To Invest In The 5G Data Revolution
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