|
Bell Atlantic, GTE: Hold it!
|
 |
April 14, 1999: 8:52 p.m. ET
Would-be merger partners ask FCC to delay consideration of $53B tie-up
|
NEW YORK (CNNfn) - Phone giants Bell Atlantic Corp. and GTE Corp. asked federal regulators Wednesday to delay consideration of their $53 billion merger until the companies work out how to meet long-distance rules.
Lawyers for Bell Atlantic (BEL) and GTE (GTE), in a joint letter, asked the Federal Communications Commission to wait for the results of an application for long-distance service in New York state.
Also in the letter, the companies asked the FCC to ignore a February request outlining how the companies would deal with the long-distance customers of GTE.
Despite numerous applications from the companies, the federal officials have denied regional phone carriers -- known as "Baby Bells" -- the right to offer long-distance service until they allow competitors to use the networks they own in their home markets.
Bell Atlantic is one of those Baby Bells, but GTE, which offers long-distance to some of its customers, is not. So as it stands, a merger of the companies would not meet FCC rules.
Last July, the companies unveiled what was then a $53 billion merger of Northeast power Bell Atlantic with Irving, Texas-based GTE, which has local access lines scattered throughout the country.
Bell Atlantic believes it has a good chance to prove the market it dominates, the Northeast, is competitive. The company is close to filing a request with New York state to ask for a right to offer long-distance there.
Sue Butta, a Bell Atlantic spokesperson, said the companies expect a ruling from New York officials by late May. After that point, she said, "we will be in a better position to bring our application" to the FCC.
Some telecom analysts say Bell Atlantic is among the Baby Bells -- which include regional companies BellSouth (BLS), SBC Communications (SBC) and US West (USW) -- that has the best chance of winning approval for long-distance. But Bell Atlantic and GTE may believe there is still room to improve their bid, one analyst said.
"It sounds like the companies are sensing the FCC if not going to look favorably on their existing application," Jeffrey Kagan, an analyst at Kagan Telecom Associates. "They're going to go back and look at the sticky areas so that it will pass muster."
The 1996 Telecommunications Act requires the Baby Bells to meet a 14-point checklist of requirements proving competition in their home markets.
In February, Bell Atlantic and GTE had requested "limited relief" from that rule in the markets where GTE has long-distance service. The firms laid out plans about how to move the GTE long-distance customers to new carriers.
In the letter Wednesday, Bell Atlantic and GTE asked the FCC to ignore the prior request.
On the New York Stock Exchange Wednesday, shares of Bell Atlantic edged up 1/16 to 55-5/16, while GTE shares 5/16 to 64-1/8.
|
|
|
|
|
|
Bell Atlantic
GTE
|
Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney
|
|
|
|
 |
|
