Merger With SBC Communications
In May 1998, Ameritech announced its intent to merge with SBC Communications. This brought great concern to Federal and state regulators, who in turn didn't approve the merger until SBC and Ameritech agreed to several conditions to ensure adequate competition. Most notably, regulators required:
- that the merged company offer local phone service in thirty markets outside of its home territory within thirty months of the merger (i.e. by April 2002) or pay a $1.18B penalty
- and that Ameritech Cellular assets in Chicago be sold to GTE. Since SBC already had a majority stake in a large mobile provider (Cellular One), the merged company, if it were to operate Ameritech Cellular and Cellular One both in the same market, would have wielded too much market power.
SBC and Ameritech officially merged on 1999-10-08. Prior to the merger, Ameritech's Chairman and CEO was Richard Notebaert, who later (in 2002) became CEO of competitor Qwest.
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