Atlantic Tele-Network says LR office 'likely'

LITTLE ROCK — Atlantic Tele-Network Inc., the Salem, Mass., company that has agreed to acquire $200 million of wireless assets of the former Alltel Corp., expects to establish operations in Little Rock within the next year or two, its chief executive said Friday.

"In the short term, nothing is written in stone, but we are highly likely to establish an office there," said Michael T. Prior, the chief executive.

That would help fill some of the vacuum created after Little Rock-based Alltel was acquiredby Verizon Wireless early this year.

Verizon acquired most of Alltel's operations in a $28.1 billion deal, but at least 1,000 people in the Little Rock area are expected to lose jobs because of redundancies created by the merger. So far, Verizon has cut about 200 workers statewide because of the deal, with most being in the Little Rock area.

The assets being bought by ATN were among those that regulators required Verizon to divest to receive approval to buy Alltel. The assets that ATN is seeking, which are operatedby a trust, include more than 800,000 wireless subscribers in mostly rural areas of Georgia, North Carolina, South Carolina, Illinois, Ohio and Idaho.

Separately, AT&T plans to acquire more than 1.5 million customers now served by the trust.

In a release in June, ATN said it would acquire 450 Alltel employees as part of its deal. Prior said Friday that the company plans to add "substantially north of 500" workers altogether because of the transaction.

He was unsure how many would be in Arkansas or what long-term plans for an office here would be.

"We're well aware of the talent that resides in Little Rock," Prior said. "[Talent] is very important to us. What's always made us succeed is getting great people onboard."

ATN currently has about 850 employees. Prior said ATN's approach in buying Alltel assetswould be the opposite of huge companies like Verizon or AT&T, which would seek to eliminate employees because they duplicate those companies' own work forces.

"I think we need all the people that are working in those [acquired] markets, plus a good number," he said.

In the telecom industry, Prior said, sizable facilities typically are created by three types of infrastructure: networks, call centers and information technology systems.

"There's a lot of [IT infrastructure] in telecom," Prior said. "It usually requires fairly large facilities and people. Some of that could be potentially located in Little Rock."

Of the other two infrastructure types, Prior said he believed Verizon had acquired much ofAlltel's network infrastructure. A call center "may or may not make sense to be in Little Rock, depending on what else you have there," he said.

Verizon, as part of its purchase of Alltel, acquired a call center inthe Riverdale area in Little Rock with about 800 workers.

Hamed Khorsand, an analyst with BWS Financial in Mission Hills, Calif., said Friday that he thought the Alltel asset acquisition was a "great deal" for ATN.

The company's stock has rocketed on the Nasdaq since the purchase was announced in June, from the $24 range to Friday's close of $41.93.

"It transforms the company, and management is not over their heads," Khorsand said. "They've operated large wireless networks in the past, and they're still doing it."

ATN will need employees of all types for the Alltel properties, Prior said, because ATN's current work force is busy running other operations. Those include a subsidiary that provides wireless roaming services in rural areas throughout the United States, a subsidiary that is the national telephone service provider in Guyana, and a subsidiary that provides voice and data services in Bermuda.

The company expects its purchase of the Alltel assets to close sometime this year, following approval by federal regulators. ATN then will have about a million wireless subscribers, including its international operations.

For the quarter ending June 30, ATN said revenue was $60.3 million, compared with $50.4 million a year earlier. Net income was about $10 million, compared with $11.6 million a year earlier. Those numbers are dwarfed by the major telecoms - for example, Verizon Communication's revenue in the most recent quarter was more than $26 billion.

Prior said factors working in Little Rock's favor are that "we know it's a great place to live ... we've heard a lot from local business people that it's a good place to have a business presence. There's a lot of positives. And of course, there's a lot talented people from Alltel."

ATN, however, also must weigh the fact that none of the Alltel markets it is acquiring are in or around Arkansas.