AT&T is purchasing Straight Path Communications for $1.6 billion. The all-stock deal will give AT&T access to Straight Path’s nationwide portfolio of millimeter wave (mmWave) spectrum licenses primarily in the 39 GHz and 28 GHz bands.

In total, AT&T will acquire 735 mmWave licenses in the 39 GHz and 133 licenses in the 28 GHz. The licenses cover the top 40 markets in the U.S. As part of the deal, Straight Path shareholders will receive $1.25 billion, or $95.63 per share, which will be paid using AT&T stock. The acquisition is expected to close this year and must be approved by the FCC.

The mmWave spectrum bands are highly sought after as a prime spectrum band for 5G services. The ITU, which is the standards body currently working on 5G specifications, has said that standards-based 5G deployed in the mmWave spectrum can deliver services that offer up to 10 Gb/s speeds in the uplink and 20 Gb/s speeds in the downlink.

AT&T has been working with Ericsson to test 5G in the 15 GHz and 28 GHz spectrum bands. The carrier has been able to deliver 4G HD video to Intel’s offices in Austin, Texas. The company said it has been clocking network speeds of nearly 14 Gb/s using mmWave.

The Straight Path acquisition will complement AT&T’s previous purchase of FiberTower. In that deal, AT&T secured access to FiberTower’s extensive footprint of mmWave spectrum in the 24 GHz and 39 GHz bands.

Straight Path was formed as a spectrum-holding company with licenses in the 28 GHz and 39 GHz bands. Those licenses were originally owned by bankrupt fixed wireless provider Winstar Communications.

The FCC fined Straight Path $100 million in January for failure to deploy wireless services as required by the FCC’s licensing policy. As part of that settlement, Straight Path had to surrender 196 of its licenses in the 39 GHz band, sell the remainder of its licenses, and give 20 percent of the proceeds of that sale to the U.S. Treasury Department.