Cingular gets OK to acquire AT&T Wireless

WASHINGTON — Justice Department antitrust regulators cleared the way Monday for Cingular Wireless LLC’s $41 billion acquisition of Redmond, Wash.-based AT&T Wireless Services Inc., a crucial step toward creating the nation’s largest wireless telephone company.

The merger still must be approved by the Federal Communications Commission. That could come as early as Tuesday.

Under an agreement with the Justice Department filed in federal court in Washington, D.C., Cingular must divest itself of the new combined company’s assets in 11 states.

“Without these divestitures, wireless customers in these markets would have had fewer choices for their wireless telephone service and faced the risk of higher prices, lower quality service and fewer choices for the newest high-speech mobile wireless data services,” said R. Hewitt Pate, assistant attorney general for the Justice Department’s antitrust division.

Cingular is an Atlanta-based joint venture of BellSouth Corp. and SBC Communications Inc. of San Antonio. Its acquisition of AT&T Wireless would create a cellular phone colossus with 46 million customers, topping the 37.5 million customers of Verizon Wireless and paring the number of national wireless phone providers to five.

Together the two companies have about 70,000 employees, although layoffs are expected if the merger goes through as expected.

Stan Sigman, Cingular president and chief executive officer, said the new company would provide wireless services in 49 states and the 100 top metropolitan areas. AT&T Wireless officials deferred comment to Cingular.