FCC Record, Volume 15, No. 3, Pages 1205 to 1858, Supplement Page: 1,227
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i PUBLIC NOTICE
FEDERAL COMMUNICATIONS COMMISSION
445 TWELFTH STREET, S.W.
WASHINGTON, D.C. 20554
News media information 202/418-0500 Fax-On-Demand 202/418-2830 Intemet: http://www.fcc.gov ftp.fcc.gov
Released: October 22, 1999
WIRELESS TELECOMMUNICATIONS BUREAU AND INTERNATIONAL
BUREAU COMPLETE REVIEW OF PROPOSED INVESTMENT BY
TELEFONOS DE MEXICO, S'.A. DE C.V. IN PARENT OF
CELLULAR COMMUNICATIONS OF PUERTO RICO
Pursuant to sections 4(i), 214 and 310(d) of the Communications Act of 1934, as amended,
47 U.S.C. 154(i), 214, 310(d), and sections 0.261 and 0.331 of the Commission's rules, 47
C.F.R. 0.261, 0.331, the Wireless Telecommunications Bureau (WTB) and the International
Bureau (IB) have completed their review of the proposed investment by Telefonos de Mexico, S.A.
de C.V. (Telmex) in SBC International-Puerto Rico, Inc. (SBCI-PR), the parent company of
Cellular Communications of Puerto Rico, Inc. (CCPR) and an indirect subsidiary of SBC
Communications, Inc. (SBC). The Bureaus recently approved SBC's acquisition of control of
CCPR's licenses through SBCI-PR. See International Bureau and Wireless Telecommunications
Bureau Grant Consent for Transfer of Control of Licenses of Cellular Communications of Puerto
Rico, Inc. to SBC Communications, Inc., Public Notice, DA 99-1654, rel. Aug. 18, 1999.
The proposed investment by Telmex in SBCI-PR is the second of two transactions
involving SBC (and its subsidiaries) and CCPR. In the first transaction, CCPR became an indirect
subsidiary of SBC when SBC purchased 100% of the common stock of CCPR, the shares of which
are held by SBCI-PR. In the second transaction, which the Bureaus address in this Public Notice,
Telmex proposes to acquire fifty percent of the voting equity of SBCI-PR. The parties have stated
that SBC will remain in control of CCPR because the corporate governance structure of SBCI-PR,
including the Certificate of Incorporation of SBCI-PR, gives SBC control of the Board of Directors
and, consequently, the ability to appoint officers and other managers and control the day-to-day
operations of CCPR.
The Wireless Telecommunications Bureau has determined that Telmex's investment should
be treated as aproforma transfer of control. Section 1.948(b) of the Commission's rules, 47 C.F.R.
1.948(b), provides that a change from less than fifty percent ownership to ownership of fifty
percent or more constitutes a transfer of control. Therefore, Telmex's investment involves a
transfer of control. WTB has determined that Telmex's investment should be viewed as an
insubstantial change in control and, therefore, processed on a pro forma basis because SBC will
remain in control after Telmex's investment. Currently, SBC controls CCPR and its licensee
subsidiaries through the exercise of absolute voting control. After Telmex's investment, SBC will
control by means of its fifty-percent equity holding and the structure created by the corporate
governance documents. Further, according to the parties, while Telmex will hold the other fifty
percent of the equity of SBCI-PR, Telmex will not have true negative control of the CCPR
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United States. Federal Communications Commission. FCC Record, Volume 15, No. 3, Pages 1205 to 1858, Supplement, book, 2000; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc2992/m1/40/: accessed November 17, 2018), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.