DoJ requiring Verizon Wireless to divest assets prior to Rural Cellular Corporation acquisition

Verizon seems to be snatching up wireless assets and infrastructure faster than a fat kid inhaling Ding-Dongs (remember those?). Following on the No. 2 US wireless carrier’s announcement that they’ll be gobbling up Alltel’s subscriber base, Verizon is poised to finalize their acquisition of Rural Cellular Corp.’s Unicel network.

But, before Verizon (NYSE: VZ) can proceed with the merger, the US Department of Justice has mandated that Verizon Wireless divest some of its assets in Vermont, New York and Washington. The DoJ’s Antitrust Division found that Verizon’s acquisition could lead to reduced competition, potentially hurting the consumer.

To that end, the DoJ’s Antitrust Division has filed suit to block Verizon’s acquisition of Rural Cellular until the divestiture requirements are satisfied.

“These divestitures are necessary to preserve the benefits of competition for residents throughout the state of Vermont and in areas of New York and Washington,” said Thomas O. Barnett, Assistant Attorney General in charge of the Department’s Antitrust Division.

As soon as Verizon meets the merger requirements and gets the go-ahead from the FCC, we could see Verizon become even larger – closing the gap between the CDMA carrier and the No. 1 US wireless carrier AT&T (NYSE: T). That is, until Alltel gets absorbed by Verizon and the CDMA becomes the new wireless leader in the US.

[Via: Cellular News]