Leading wireless carrier,
) announced that it will provide communication services to the
Formula One racing team, Infiniti Red Bull Racing. AT&T will
connect the workforce of Infiniti Red Bull Racing across key
locations like Milton Keynes, U.K., Infiniti Red Bull's
headquarter, engine manufacturer Renault in Viry, France and the
team's wind tunnel, Bedford, U.K.
AT&T will also connect the team's trackside for any
20-race circuits around the world. We believe the new deal will
be accretive to AT&T's growing wireless business revenues and
at the same time expand its reach globally.
Strategic business deals have played major roles in shaping
AT&T's growth story. We are encouraged by the company's
global alliance with GE that allows machines of the latter to
connect with AT&T network and cloud, creating the first
highly secure wireless communication services for GE's Industrial
Internet eco system. We also foresee revenue sources from
AT&T's collaboration with
Delta Air Lines
) for providing Wi-Fi connectivity on 4G networks. Further,
AT&T struck a global networking services deal with New
Zealand-based Opus International Consultants.
Further, the company proposed to take over the largest prepaid
wireless operator in the U.S. -
Leap Wireless International
) - for $1.2 billion. This acquisition will also give AT&T
control over Leap's spectrum in the PCS and AWS bands covering
137 million people, thereby enhancing the spectrum base of the
former. Further, the deal will endow AT&T with a stronger
pre-paid business line, competitive advantage, more customer care
service facilities, low-cost data plans and robust financial
resources. The deal is currently awaiting regulatory approval and
is expected to be over by early 2014.
In Sep 2013, AT&T Inc. closed the acquisition of Alltel's
wireless operations from Atlantic Tele-Networks Inc. for $780
million. The acquisition gave the telecom behemoth spectrum
licenses, retail stores and network assets of Alltel.
Additionally, AT&T gained Alltel's 585,000 subscribers in six
states, particularly in the South and Midwest U.S. Furthermore,
the company is reportedly contemplating a buyout of the world's
second largest telecom company,
Vodafone Group plc
) next year.
We believe that all these acquisitions and strategic
partnerships support the company's growth goals in wireless
services, in particular data services, which represent $22
billion in annualized revenues growing at a rate of approximately
18% per annum.
AT&T retains a Zacks Rank #3 (Hold).
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