AT&T Inc. (T) is making an anticipated foray into the Mexican wireless business with the $2.5 billion purchase of Iusacell SA from Grupo Salinas.
"Mexico is still in the early stages of mobile Internet capabilities and adoption, but customer demand for it is growing rapidly," AT&T chairman and CEO Randall Stephenson said in a press release announcing the deal on Friday.
Iusacell, Mexico's third-largest mobile carrier, would complement the satellite TV operations in Mexico and other Latin American countries that AT&T would gain through the pending $67.1 billion purchase of DirecTV Group Inc. (DTV) Iusacell could also be a launching pad for other acquisitions in Mexico.
Though AT&T had indicated an interest in Latin America, a purchase of assets from Carlos Slim Helu's América Móvil SA had seemed more likely.
América Móvil has acknowledged putting assets on the market, after regulators proposed restrictions on dominant communications companies if they did not split up their holdings.
BTIG LLC analyst Walter Piecyk suggested in a Monday note that more deals could follow.
"The acquisition of Iusacell for $2.5 billion gives AT&T less than 10% wireless market share in Mexico, but could set the stage to layer on additional regional assets in Mexico that América Móvil is attempting to sell or even assets from the bankrupt [NII Holdings Inc.] (NIHD) ," Piecyk wrote.
The analyst values the Iuscell purchase at 20 cents per megahertz per person covered, and $145 per subscriber.