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Attorney General William H. Sorrel Announces Verizon Wireless And Unicel Mobile Phone Merger Settlement

CONTACT: Julie Brill, Assistant Attorney General, (802) 828-3658

June 10, 2008 - Attorney General William H. Sorrell announced today that, along with the United States Department of Justice, he has entered into a settlement with Verizon Communications, Inc., which operates Verizon Wireless, and Rural Cellular Corporation, which operates Unicel, regarding Verizon’s planned merger of the two mobile phone companies. The settlement will require that the merged company sell all overlapping assets in Vermont, so that a new wireless phone company can come into Vermont and offer competition to consumers.

“Today’s settlement is an antitrust home run,” said Attorney General Sorrell. “Mobile phones are a rapidly growing part of our economy, and maintaining competition in this market is vitally important to the overall economic health of our state. By requiring Verizon and Unicel to find a competitor to enter the Vermont market in a strong position, this settlement will ensure that consumers continue to enjoy the benefits of competition in the cell phone market.”

The settlement, filed today by the Vermont Attorney General and the United States Department of Justice in the United States District Court for the District of Columbia, requires Verizon and Rural Cellular Corporation to divest, or sell off, overlapping assets throughout Vermont, as well as a few areas of upstate New York and Washington State, in order to allow Verizon to proceed with the acquisition of Rural Cellular Corporation. The settlement consists of a complaint and proposed consent decree.

Verizon is the second largest mobile wireless service provider in the United States as measured by subscribers. It operates in 49 states and serves in excess of 65 million subscribers. Rural Cellular Corporation is the 10th largest mobile wireless service provider in the United States as measured by subscribers. It operates in 15 states and serves approximately 790,000 subscribers.

In July 2007, Verizon announced that it planned to acquire Rural Cellular Corporation for approximately $2.67 billion. The Vermont Attorney General and the United States Department of Justice investigated the planned merger, and alleged that, in the absence of a complete divestiture of overlapping assets, the combination of Verizon and Rural Cellular Corporation would likely substantially lessen competition for mobile wireless telecommunications services throughout Vermont, causing Vermont residents to face increased prices, diminished quality or quantity of services, and less investment in network improvements for these services. The proposed consent decree filed today will address concerns about maintaining competition in this critical area of the Vermont economy.

  Website consulting provided by The National Association of Attorneys General.