AT&T Inc., the second largest wireless provider in the U.S, received clearance from the Justice Department and the Attorney General of Louisiana to buy Centennial Communications Corp. Despite this green light, the FCC continues to review the deal, which was announced almost a year ago. The merger stipulates that Centennial Communications Corp., the eighth largest wireless provider in the U.S, stockholders will yield $8.50 per share for the sale, $944 million altogether.
The Department of Justice’s Antitrust Division, along with Louisiana Attorney General, filed a civil suit in U.S District Court yesterday seeking to block AT&T’s takeover of Centennial. According to the filing, the two wireless companies are each other’s closest competitors in at least eight FCC defined cellular markets. The proposed merger dramatically reduces competition in these areas, located in Louisiana and Mississippi.
The Department and Attorney General simultaneously proposed a settlement for their suit, which they claim resolves their concerns about the deal. AT&T agreed to the deal, which requires they sell off eight service areas in Mississippi and Louisiana. Five will be sold to Verizon and Vodafone for about $240 million.
Both AT&T and Centennial issued statements after receiving U.S antitrust approval. Wayne Watts, AT&T’s senior executive vice president and general counsel, said:
“We are pleased with the Department of Justice’s decision and see it as an important step toward closing our acquisition of Centennial.”
Michael J. Small, Centennial’s CEO, said:
“We appreciate the Department of Justice’s efforts in clearing the merger. With this approval, Centennial hopes to complete the FCC review process soon so that our customers can begin to enjoy the meaningful benefits that our merger with AT&T will bring them.”
Chalk this up as another win for the mobile phone monopolies.