NEW YORK-Following Cingular Wireless L.L.C.’s announced acquisition of wireless rival AT&T Wireless Services Inc. earlier this week, Fitch Ratings placed Cingular and well as its parent companies SBC Communications Inc. and BellSouth Corp. on Rating Watch Negative and AWS’ on Rating Watch Positive.
Fitch explained that while the acquisition would be positive for wireless industry fundamentals, it did not believe pricing pressure would abate materially given at least five competitors in most major markets. Fitch also voiced concern regarding the leveraging impact of Cingular’s parent companies financing the acquisition.
