AT&T Earns Mexican Regulator Approval For Iusacell Purchase, 1Q 2015 Completion Expected

Mexican regulators have approved AT&T’s previously announced plans to purchase local wireless carrier Iusacell from the Grupo Salinas conglomerate with unspecified conditions, according to a new report by Reuters. The approval clears the way for the completion of the purchase, which is now expected for the first quarter of 2015. However, the purchase still needs to be approved by US regulators before final completion of the deal. CEO Randall Stephenson also alluded to the deal being beneficial regarding its other recent acquisition in Cricket Wireless, which has a substantial and growing presence in predominantly Hispanic areas.

With the forthcoming purchase of the carrier, AT&T looks to expand its native coverage area throughout the Mexican territory under the North American Mobile Service initiative, with the majority of Iusacell’s coverage area centered on southern Mexico and the Mexican Federal District. AT&T intends to expand coverage further nationwide while also rolling out LTE, as Iusacell does not currently operate an LTE network, should the purchase be fully approved. As Iusacell and AT&T operate nearly identical GSM/HSPA base networks, the transition from Iusacell to AT&T is expected to be transparent and the corporate headquarters for Iusacell will remain in Mexico City.

Although much is being made of Iusacell’s lack of mobile broadband options by executives and media reports, the company does offer such options over its HSPA+ data network on postpay and prepaid, though Iusacell and its prepaid-only sibling brand in Unefon are frequently derided in Mexico for service quality that isn’t commensurate with its pricing, which while less expensive than rival Telcel, still suffers from outages along with customer service and billing issues. With the forthcoming purchase, many Iusacell customers that are following these developments are becoming wary of AT&T’s declarations of network expansion, as they are quickly becoming familiar with the US carrier and its own history.