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AT&T closes Iusacell deal, names Arroyo CEO

$2.5B deal bolsters AT&T’s North America plans

AT&T said it has closed on its $2.5 billion acquisition of Mexico wireless operator Iusacell, just over two months after announcing the deal.

AT&T purchased the carrier from Grupo Salinas, which last week closed on its acquisition from Televisa of the 50% stake in Iusacell it did not previously own. For its $2.5 billion, AT&T acquired Iusacell’s wireless properties, including licenses, network assets, retail stores and approximately 8.6 million subscribers. Iusacell currently operates a 2G and 3G network using GSM/UMTS technology covering around 70% of Mexico’s population under the Iusacell and Unefon brands.

In closing the deal, AT&T again touted plans to offer up what it called the first-ever North American mobile service area tapping into its own U.S.-based network and Iusacell’s footprint. AT&T said the combined networks would cover more than 400 million potential customers.

Iusacell does not currently offer LTE services, which have become a staple of AT&T’s domestic marketing efforts, but AT&T said it plans to invest in bolstering Iusacell’s network without specifically stating plans for LTE. Iusacell’s spectrum portfolio includes between 20 megahertz and 25 megahertz of 800 MHz spectrum primarily in the southern half of the country, including Mexico City and Guadalajara, and an average of 39 megahertz of 1.9 GHz spectrum covering all of the country. AT&T Mobility offers service in both the domestic 800 MHz and 1.9 GHz bands.

Mexico telecom regulator Instituto Federal de Telecomunicaciones announced on Dec. 21 that it had approved AT&T’s proposed deal, in a move that could provide more robust competition for the country’s dominate wireless operator América Móvil. Mexico has recently begun to implement regulations designed to make its telecom market more competitive

AT&T’s management cited the quick approval of its acquisition as one reason for the investment.

“The quick approval of this deal is one more example of why Mexico is an attractive place to invest,” said Randall Stephenson, AT&T chairman and CEO.

Following closing of the deal, AT&T named Thaddeus Arroyo as CEO of Iusacell, replacing former CEO Adrian Steckel who will assist Arroyo with the integration of Iusacell into AT&T. Arroyo is a 19-year AT&T veteran, having previously served as president of AT&T technology development.

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