Bank of America Comments on AT&T Lusacell Acquisition

Following the November 7 announcement that AT&T T has agreed to acquire Mexican wireless operator Lusacell for $2.5 billion, Bank of America analyst, David Barden issued a note today describing his take on the deal. Barden begin by noting lusacell has approximately 8.6 million subscribers that are estimated to generate $1.5 billion in service revenue and $179 million in EBITDA during 2014. Barden commented, "AT&T plans to invest in the lusacell asset to upgrade the network to LTE. We believe any investment will number in the hundreds of millions of dollars a year range." According to Barden, the deal is consistent with the strategy laid out by top management at AT&T during the 2014 Bank of America Telecom and Media Conference this past September. To fund the acquisition, Barden noted AT&T will use proceeds from the sale of its Connecticut operations to Frontier. Looking forward, Barden expects the deal to close by the first quarter of 2015 and is waiting for more information from Randall Stephenson at this week's presentation.
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Posted In: NewsM&ABank of AmericaDavid Barden
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