AT&T Seeks Verizon Wireless Assets

In the bidding for the roughly $3 billion in wireless assets Verizon Wireless must divest as part of its purchase of Alltel Corp., one strong but controversial contender is emerging: AT&T. The telecom giant is among the bidders, along with a joint bid from private-equity firms Carlyle Group and Kohlberg Kravis & Roberts & Co. and a separate bid from Providence Equity Partners. Verizon Wireless agreed to sell the assets to get government approval for the $28.1 billion Alltel purchase, which closed last month. Assets include 2.1 million wireless subscribers in 22 states, as well as wireless spectrum and other assets necessary to run the businesses in those markets. AT&T is in the strongest financial position of the interested companies and is in a good position to walk away with a large chunk of the assets. Critics, including consumer advocates and Verizon's smaller competitors, say such a deal -- allowing one giant telecom provider to transfer customers to another -- wouldn't be in the interest of consumers. AT&T and Verizon Wireless have a combined 160 million subscribers, nearly 60% of the entire U.S. market. Gigi Sohn, president of the public interest group Public Knowledge, said the government should encourage Verizon to sell the assets to smaller players to enhance competition. "This could be one of the first big tests for the Obama administration to see if their antitrust enforcement will have any teeth," Sohn said.