Cingular Wireless L.L.C. tied up one of the loose ends to its pending acquisition of AT&T Wireless Services Inc. by announcing a deal with AWS affiliate Triton PCS Inc. to swap assets in a handful of markets. The deal also will back AWS out of its investment in Triton PCS in exchange for dropping a non-compete clause and signing a new roaming agreement between Cingular and Triton.
Under terms of the non-binding letter of intent, which is subject to Cingular closing its acquisition of AWS scheduled for later this year, Cingular will receive Triton PCS’ network assets and customers in Virginia in exchange for Triton PCS receiving certain AWS network assets and customers in North Carolina and Puerto Rico plus $175 million in cash from Cingular. The companies noted employees in the affected markets would be part of the exchange.
In addition, Triton PCS and AWS have entered into a definitive agreement to terminate the stockholder agreement including the termination of an exclusivity agreement that prevented AWS from selling service in Triton PCS’ markets in return for the surrender of AWS’ equity in Triton PCS, which analysts have noted is around 17 percent. As part of this arrangement, Triton PCS will have exclusive rights to the SunCom brand name and said it will be able to compete beyond its current footprint, while Cingular will be able to provide service in markets where Triton PCS currently offers service.
The deal also calls for Triton PCS and Cingular to enter into a new long-term, reciprocal roaming agreement that will provide Triton PCS access to a nationwide network and provide Cingular with coverage in all top 100 U.S. markets following its acquisition of AWS.
