Bigwig US carrier AT&T revealed in a Friday announcement that it is acquiring San-Diego-based prepaid wireless provider Leap Wireless International for $15 per share or approximately $1.2 billion in cash.

Dallas-based AT&T's offer of `$15 per share' for Leap's acquisition represents a premium of 88 percent over Leap's closing price of $7.98 on Thursday. Leap currently operates under the Cricket brand, and covers almost 96 million people in 35 US states.

According to the terms of the acquisition deal, AT&T will acquire all of the stock and wireless properties of Leap, including its network assets, licenses, retail stores and nearly 5 million subscribers. The deal will essentially give AT&T more airwaves and a bigger chunk of the pay-as-you-go market.

Moreover, AT&T's acquisition of Leap - which had $2.8 billion of net debt, as of April 15, 2013 - will also give the Leap shareholders the contingent right that will entitle them to the net proceeds received on the sale of Leap's 700 Mhz "A Block" spectrum in Chicago, which was purchased by the wireless provider in August 2012 for $204 million.

Noting that AT&T's move to acquire Leap will improve AT&T's spectrum position as well as expand its offerings in the prepaid arena, AT&T spokesman Brad Burns said: "We'll make the prepaid market more competitive. Leap's customers will be able to ride on our fast LTE network."