AT&T has completed its $2.5 billion acquisition of Mexican mobile operator Iusacell from Grupo Salinas, first announced in November, and has named F. Thaddeus Arroyo to lead Iusacell as its CEO.
Through the acquisition, AT&T plans to create the first-ever North American Mobile Service area covering more than 400 million consumers and businesses in Mexico and the US.
AT&T acquired all of Iusacell’s wireless properties, including licences, network assets, retail stores and approximately 9.2 million connections. Iusacell is Mexico’s third largest mobile operator, behind America Movil’s 70 million and Telefonica’s 21 million connections.
The Iusacell network currently covers about 70 per cent of Mexico’s approximately 120 million citizens and its 3G network is based on the same WCDMA technology used by AT&T.
Iusacell’s new CEO has worked at AT&T for 19 years, having most recently overseen technology development at the US operator. He has also held the CIO role for AT&T, AT&T Mobility and Cingular Wireless.
Iusacell’s previous CEO, Adrian Steckel, will work with Arroyo to assist with the integration of the Mexican company into AT&T.
Earlier this month, Mexican broadcaster Grupo Televisa announced the sale of its 50 per cent stake in Iusacell to its joint venture partner Grupo Salinas, which prepared the way for the acquisition.
“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. “We look forward to bringing more wireless competition to Mexico along with an improved mobile internet experience for customers.”
The company’s investments in Mexico — where smartphone penetration is about half that of the US — will help it address increasing demand for high-speed mobile internet services.
AT&T said Iusacell represents a natural geographic expansion of its wireless footprint in a country with a growing economy that is interconnected with the US economy. The company also said that Iusacell is a good long-term growth opportunity, with manageable near-term cash flow and capital expenditure requirements.
Iusacell will continue to be headquartered in Mexico City, where a team identified by AT&T will oversee the integration effort.