Bell Atlantic, GTE, Alltel Swap Wireless Interests
- 01 February, 2000 12:01
LONDON (02/01/2000) - Bell Atlantic Corp., GTE Corp. and Alltel Corp. have agreed to swap wireless interests in 13 U.S. states in a deal designed to gain regulatory approval for Bell Atlantic's proposed merger with U.K. telecommunications company Vodafone AirTouch PLC.
The companies will transfer the wireless interests by mid-year and Alltel will pay an additional US$600 million to Bell Atlantic, GTE and Vodafone AirTouch, the companies said in a statement. Though the total value of the deal was not disclosed, a report in The Wall Street Journal estimated the swap to be worth $3 billion.
The deal will allow Bell Atlantic to proceed with its merger of the U.K. telecommunications company Vodafone AirTouch PLC for its U.S. wireless operations, the companies said. Bell Atlantic and Vodafone had reached a consent decree with the U.S. Department of Justice (DOJ) on Dec. 6 promising to eliminate overlaps of wireless services that the merger would create.
The merger, now expected to be completed by mid-year, would create a new company which Bell Atlantic valued at more than $70 billion when it announced the planned merger last September. [See "Bell Atlantic, Vodafone AirTouch Merge U.S. Assets," Sept. 21.]The next step for Bell Atlantic is to eliminate wireless markets with GTE so those companies can continue their planned merger, the companies said. Bell Atlantic is currently working with the U.S. Federal Communications Commission (FCC) to work out government competition concerns over the merger, valued at $52.8 billion. [See "Bell Atlantic, GTE May Sell GTE's Net Interests," Jan.
The wireless swap agreement will give Bell Atlantic and GTE wireless interests in 27 markets to Alltel in exchange for Alltel's interests in 42 markets in Illinois, Indiana, Iowa, Nevada, New York and Pennsylvania for a combined population of 8.9 million, the companies said. The markets that Alltel will receive are in Alabama, Arizona, Florida, Ohio, New Mexico and South Carolina, covering more than 1.5 million customers with a population of 14 million, the companies said.
The wireless swap will also include 700 Bell Atlantic employees and 1,000 GTE workers moving to Alltel, and 900 Alltel employees will join the Bell Atlantic/GTE/Vodafone AirTouch venture, the companies said.
Alltel, in Little Rock, Arkansas, can be contacted at +1-501-905-8117, or at http://www.alltel.com/. Bell Atlantic, in New York, can be reached at +1-212-395-3400 or at http://www.bellatlantic.com/. GTE, in Irving, Texas, can be reached at +1-972-507-5000 or at http://www.gte.com/. Vodafone AirTouch, in Newbury, England, can be contacted at +44-16-35-33-251, or at http://www.vodafone-airtouch-plc.com.