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US telecom carrier AT&T on Friday announced its plans to acquire Iusacell, the third-largest wireless operator of Mexico, for USD 2.5 billion in order to create a vast mobile network covering the two nations.
Notably, the deal is subject to get green signal from the regulatory authorities in Mexico.
With the new agreement, AT&T will gain an additional 8.6 million mobile phone subscribers in Mexico.
According to AT&T, the acquisition will be completed after the Mexican conglomerate Grupo Salinas shuts its purchase of the 50 percent of Iusacell that it does not already own.
“Our acquisition of Iusacell is a direct result of the reforms put in place by President (Enrique) Pena Nieto to encourage more competition and more investment in Mexico. Those reforms together with the country’s strong economic outlook, growing population and growing middle class make Mexico an attractive place to invest,” Randall Stephenson, AT&T chairman and chief executive, said in a statement.
The development comes at a time when the country is gearing up to encourage healthy competition in the wireless sector.
Mexico’s telecom giant offers the wireless services under its own name and the Unefon brand, a network that covers about 70 percent of the country’s 120 million people.
Meanwhile, AT&T revealed its plans to carry out its network expansion in order to cover more population in Mexico.
“Iusacell gives us a unique opportunity to create the first-ever North American mobile service area covering over 400 million consumers and businesses in Mexico and the United States,” Stephenson said while adding, “It won’t matter which country you are in or which country you are calling — it will all be one network, one customer experience.”
The wide network would allow the American telecom customers visiting Mexico or vice versa to use the same network without changing their phones or subscribers or use any unique calling codes.
Iusacell’s headquarter will remain in Mexico City after the closing.