WASHINGTON -- Hours after clearing the final regulatory hurdle, AT&T; Corp. completed its $12.6 billion purchase of McCaw Cellular Communications yesterday and formally began an industrywide race to build a national wireless-communications network.
As had been expected, the Federal Communications Commission approved the deal, which will unite the world's largest telecommunications company with the world's largest cellular-telephone operator. On balance, the agency said, those aspects of the deal that foster competition outweigh the anti-competitive aspects.
AT&T; is expected to move swiftly to invest in new digital equipment and roll out new services that unite wireless services with features offered over the long-distance network.
The company is also determined to expand McCaw's current reach, partly through more acquisitions and alliances and partly by bidding on new radio licenses being auctioned in December for personal-communication services.
The deal made final yesterday, originally announced more than a year ago, has already shaken up the telecommunications industry.
The regional Bell companies, fearful of AT&T;'s powerful brand name and the impact of its strong finances in the cellular arena, are worried about losing one of their most lucrative and fastest-growing markets. The deal has also galvanized long-distance rivals such as Sprint and MCI Communications into searching for wireless partners of their own.
Yesterday's signing was muted, and kept well away from the center of public attention. The two companies refused to comment on their plans until today, when AT&T; Chairman Robert E. Allen is scheduled to hold a news conference with McCaw President James L. Barksdale.
Still, AT&T;'s overall agenda has been clear for some time. The company is expected to sink more than $1 billion into equipment, upgrading McCaw's networks to a new generation of digital technology and integrating the cellular network with its own long-distance network.
The two companies have also been working on new marketing programs, hoping to offer cellular and paging services as part of a package.
Under the terms of an antitrust consent decree signed by the Justice Department, McCaw cannot start using the AT&T; brand name until after it has installed equipment that allows cellular customers to use other long-distance services.
Now that AT&T; does not have to worry that its coveted purchase of McCaw will be waylaid by legal objections, it is expected to move aggressively to find new ways of competing in the local telephone market.
AT&T;'s stock closed up 62.5 cents yesterday, at $55.50. McCaw's stock closed up 25 cents, at $55.