AT&T has announced it has agreed to acquire Mexican wireless company Iusacell for $2.5 billion. Iusacell offers wireless service under its own name and the Unefon brand name.
It has 8.6 million subscribers, but covers about 70% of Mexico’s population of 120 million. AT&T will gain the subscribers, spectrum licenses, network assets, and retail operations of Iusacell. The deal requires that Grupo Salinas, which currently owns just 50% of Iusacell, complete its acquisition of the portion of the company it does not already own. Once it does, AT&T will buy Iusacell from Grupo Salinas. AT&T said it plans to expand Iusacell’s network to cover more Mexicans. The company believes the deal makes sense for a number of reasons. Iusacell runs a GSM/UMTS network and owns 800MHz and 1900MHz spectrum in select portions Mexico.
“Iusacell represents a natural geographic expansion of [our] wireless footprint into a country with a growing economy that is interdependent with the U.S. economy,” said AT&T. “Recent changes to government policies in Mexico have created a friendly climate for foreign investment. This transaction gives AT&T the assets necessary to create a first-ever North American Mobile Service area for U.S. customers calling or visiting Mexico, and Mexican customers calling or visiting the United States –whether they live near the border or thousands of miles away.”
AT&T sees the acquisition as a long-term growth opportunity. Iusacell will remain headquartered in Mexico City. AT&T said it expects the deal to gain the necessary regulatory approvals before the end of the first quarter of 2015.
