NEW YORK, IRVING, Texas, and LITTLE ROCK, Ark. —
Bell Atlantic (NYSE: BEL), GTE Corp. (NYSE: GTE) and ALLTEL Corp. (NYSE: AT) have signed agreements to exchange wireless interests in 13 states, better positioning all three companies for future growth.
Click here for Overview of Wireless Transaction
The agreements eliminate all of the overlapping cellular operations that would be created by the combination of Bell Atlantic and Vodafone AirTouch wireless properties announced Sept. 21. The companies reached a consent decree with the Department of Justice (DOJ) on Dec. 6 to resolve the overlaps through swaps or sales.
Bell Atlantic and Vodafone AirTouch can now proceed with the merger of their domestic wireless operations, expected to take place this spring. The new venture will be further strengthened by the addition of GTE's wireless assets following the resolution of additional wireless overlaps related to its merger with Bell Atlantic.
Upon the closing of the transactions, Bell Atlantic and GTE will transfer wireless interests in 27 markets in Alabama, Arizona, Florida, Ohio, New Mexico, South Carolina and Texas, involving about 14 million POPS, or population served, and more than 1.5 million customers.
ALLTEL will transfer interests in 42 markets in Illinois, Indiana, Iowa, Nevada, New York and Pennsylvania. ALLTEL is transferring operations covering about 6.3 million POPs and more than 700,000 customers, along with 2.6 million POPS and about 300,000 customers from minority interests.
As a result of the swaps, the Bell Atlantic/GTE/Vodafone AirTouch venture will have a total of 223 million net POPs and 23 million customers and ALLTEL will have a total of 46 million cellular POPs and almost 5.8 million wireless customers.
In addition to the transfer of wireless assets, ALLTEL will also pay about $600 million to Bell Atlantic, GTE and Vodafone AirTouch. The companies said they expect to complete the transactions by mid-year.
The companies have also signed a new national "roaming" agreement, which will allow their customers to roam on each other's networks at reduced rates across a footprint that covers almost 95 per cent of the U.S. population. Using a common digital technology called CDMA, they will form the nation's largest standardized digital wireless network.
Click here for map of National Roaming Agreement.
About 700 Bell Atlantic and 1,000 GTE employees will be joining ALLTEL, while some 900 ALLTEL employees will join the new Bell Atlantic/GTE/Vodafone AirTouch venture.
"We're very pleased to have reached this agreement and proceed quickly to close our transaction with Vodafone AirTouch," said Denny Strigl, president and CEO of Bell Atlantic Mobile and designated president and CEO of the planned Bell Atlantic/GTE/Vodafone AirTouch wireless business. "Further, we strengthen our national leadership position by expanding our footprint in central Pennsylvania, the Midwest and Las Vegas."
"This is a significant step toward our shared vision of a superior national wireless footprint," said Mark Feighner, president-GTE Wireless. "It extends our ability to provide national single rate price plans covering virtually the entire U.S. population. In addition, I'm confident that the transition of properties involved will be as seamless as possible for both customers and employees. While preparing for that transition we will continue to focus on market growth by providing customers superior value and service."
ALLTEL Chairman and CEO Joe Ford said, "This transaction is an innovative approach in finding solutions to remain ahead of the competitive curve in the fast-changing communications industry. It enhances ALLTEL's geographic market clusters and increases our customer base by 15 percent and will also enhance our ability to deliver additional bundled communications services at great value to our customers."
Bell Atlantic is at the forefront of the new communications and information industry. With more than 43 million telephone access lines and 10 million wireless customers worldwide, Bell Atlantic companies are premier providers of advanced wireline voice and data services, market leaders in wireless services, and the world's largest publishers of directory information. Bell Atlantic companies are also among the world's largest investors in high-growth global communications markets, with operations and investments in 23 countries.
With 1999 revenues of more than $25 billion, GTE is a leading telecommunications provider with one of the industry's broadest arrays of products and services. In the United States, GTE provides local service in 28 states and wireless service in 18 states, as well as nationwide long-distance, directory, and internetworking services ranging from dial-up Internet access for residential and small-business consumers to Web-based applications for Fortune 500 companies. Outside of the United States, the company serves customers on five continents.
ALLTEL provides communications services to more than 8 million customers in 25 states and has information services clients in 55 countries and territories. ALLTEL is a customer-focused, information technology company that provides wireline and wireless communications and information services. Vodafone AirTouch
Vodafone AirTouch, based in the United Kingdom, is the world's largest mobile telecommunications company. It has mobile operations in 24 countries on five continents, with more than 31 million proportionate customers. In the United States, AirTouch serves more than 9 million proportionate cellular and PCS customers in 25 states and 22 of the top 30 U.S. markets, including Atlanta, Chicago, Dallas, Detroit, Houston, Los Angeles, Phoenix, San Diego, San Francisco and Seattle.