InterCel Inc. has entered into a definitive agreement to purchase GTE Mobilnet Inc.’s personal communications services license for the Atlanta major trading area, pending regulatory approval.
“The addition of the Atlanta MTA represents an early opportunity for InterCel to extend its wireless coverage beyond our three-MTA cluster now under construction,” said Allen Smith, InterCel’s president and chief executive officer.
Bidding as Powertel PCS Partners L.P., InterCel won licenses for the Memphis, Tenn., Birmingham, Ala., and Jacksonville, Fla., MTAs at auction. The company said it expects to offer PCS service beginning in this year’s fourth quarter under the Powertel brand name.
InterCel said it paid about $195 million for the Atlanta MTA. GTE’s winning bid for Atlanta was about $185 million, which doesn’t include associated costs.
GTE sold its Denver MTA license to Western Wireless Corp. in January, and acquired the Spokane, Wash./Billings, Mont., MTA license from Poka Lambro Telephone Cooperative Inc. at about the same time.
In addition to Spokane, GTE has two remaining MTA licenses from the auction: Seattle and Cincinnati. GTE spokeswoman Laurie Douglas said the company intends to build out those PCS networks and offer service in early 1997.
“We’re moving ahead as quickly as possible,” she said.
In December 1994, GTE plunked down $50 million in upfront payments for the auction, the fifth highest amount paid.
An industry analyst who is familiar with the situation but would speak only on background noted that GTE didn’t pursue any particular geographic strategy but tried to acquire markets that seemed to be a good value. In the end, GTE was left in a difficult position. It was regionally scattered, lacked critical mass and had multiple telecommunications interests to reconcile.
GTE said it wants to pursue a “cluster” strategy in its remaining markets.
Douglas said GTE can strengthen its presence in the Midwest with a PCS buildout in Cincinnati next to its cellular operations in Indianapolis and Cleveland.
The company can also build upon its name presence in Seattle where it provides wired phone service as GTE Northwest, Douglas said.
