WASHINGTON—The Justice Department said Alltel Corp. agreed to sell wireless assets in several rural Minnesota markets as a condition to antitrust approval of its $1 billion purchase of regional operator Midwest Wireless.
“The department’s action ensures that wireless telephone consumers will continue to obtain the benefits of competition—lower prices and higher quality,” said Thomas Barnett, chief of the department’s antitrust division. “The required divestitures preserve competition in rural areas where consumers often have fewer choices for wireless telephone services.”
The state of Minnesota supports the divestiture, in which Alltel will get rid of mobile phone systems in four rural markets where Midwest also offers service, and the issue is now headed to a federal judge for consideration. The Federal Communications Commission too is expected to rule on the Alltel-Midwest Wireless deal by month’s end.
U.S. Cellular Corp. previously warned the FCC that an Alltel-Midwest tie-up would hurt competition in southern Minnesota.
Alltel, based in Little Rock, Ark., is the nation’s fifth-largest mobile phone operator, serving around 11 million customers. Alltel also provides roaming and other wireless services in 35 states to other mobile wireless providers who use CDMA, TDMA and GSM technologies. Alltel had wireless revenues of approximately $6.6 billion last year.
Midwest Wireless, headquartered in Mankato, Minn., serves around 440,000 wireless customers in three states. Midwest Wireless also provides roaming and other wireless services to other mobile wireless providers who use CDMA technology. Last year Midwest Wireless earned about $264 million in revenues.
