Last month AT&T announced plans to acquire Straight Path Communications for $1.6 billion, specifically to gain access to a valuable swath of high frequency spectrum owned by the company – the kind of spectrum needed to build out a 5G wireless network. But Verizon has just crashed the party by nearly doubling the offer, and closing the deal at $3.1 billion in an all-stock transaction.

Straight Path started acquiring wireless spectrum more than 15 years ago and is currently one of the largest holders of millimeter wave spectrum. Earlier this year, however, the company was fined $100 million by the FCC for failing to deploy the wireless services required by its spectrum licenses, a practice called "spectrum squatting."

This accelerated Straight Path's plans to look for a buyer and now it's found now in Verizon. The carrier confirmed the news today saying it expects the transaction to close within nine months, subject to FCC review. Straight Path's acquisition will allow Verizon to secure millimeter wave spectrum ready for 5G, including 39 GHz licenses across the US and 28 GHz assets in key areas.

Today's 4G LTE deployments utilize low-band frequencies below 1GHz which can cover long distances and penetrate obstacles such as building walls. On the other hand, millimeter wave, which is expected to play a large role in 5G, can't penetrate physical objects like walls and trees and it has a limited range, but it can deliver multi-gigabit speeds at extremely low latencies and there's more of it to go around.

Millimeter wave is expected to be used in conjunction with other lower band spectrum in order to build out 5G networks. Most carriers are targeting 2019 - 2020 for widespread launch of their 5G services, with trials already underway for fixed 5G in several U.S. cities.