AT&T completed its $1.2 billion acquisition of prepaid provider Leap Wireless after receiving approval from the FCC, the US telecoms regulator.

Under the terms of the deal, AT&T gains approximately 4.6 million customers, as well as spectrum, network equipment, and other assets from Leap.

Leap shareholders get $15 per share in cash, plus the right to receive net proceeds from the sale of Leap’s 700MHz ‘A-Block’ spectrum in Chicago (which Leap purchased for $204 million in August 2012).

The FCC ruling noted, however, that the “proposed transaction has the potential to cause some competitive and other public interest harms in several local markets, as well as to value-conscious consumers”.

To address those public interest fears, AT&T made a range of commitments, including spectrum divestitures in certain markets.

AT&T further pledged to deploy LTE services using unused Leap spectrum “within 90 days or 12 months of closing”. This is to ensure spectrum is being deployed and consumers in current Leap service areas will benefit from AT&T’s 4G network.

AT&T also made commitments to build out LTE service in six specific markets in south Texas within 18 months, while promising to offer certain rate plans targeted at “value-conscious” customers.

Another AT&T promise is to offer a device trade-in credit program and a feature phone device trade-in programme to certain Leap customers prior to discontinuing CDMA service.

Leap Wireless, which operates under the Cricket brand, currently covers around 97 million people in 35 US states. AT&T said customer migrations are expected to be completed about 18 months after the launch of the new Cricket.

The new Cricket will be an independently operated, wholly owned subsidiary of AT&T.

In addition to Cricket’s operations, AT&T also acquired spectrum in the PCS and AWS bands covering nearly 138 million people.

AT&T said these assets are “largely complementary” to its existing spectrum holdings and includes unused wireless frequencies covering 41 million people. The operator said it would immediately put the unutilised spectrum to use to support LTE services.

AT&T made its surprise $1.2 billion cash bid for Leap Wireless last July, which, at $15 per share, was nearly a 90 per cent premium on Leap’s trading price at the time.

At the close of Nasdaq trading yesterday (13 March), Leap’s share price was $17.52.

AT&T said it would update its full-year 2014 guidance to reflect the impact of this transaction when it announces Q1 2014 results on 22 April 2014.