Mexican cellco Grupo Iusacell has confirmed it will merge with smaller carrier Unefon. The amalgamation of Unefon into Iusacell will give the combined company more than 3.4 million wireless subscribers, or about 7% of the Mexican market, the company said in a filing with the Mexican Stock Exchange. Iusacell and Unefon began consolidating operations last year. Iusacell said the boards of both companies approved the merger plan, which will be put to shareholders. Gustavo Guzman will remain as chief executive of Iusacell. The proposal values Iusacell at USD1 billion and Unefon at USD333 million. Iusacell will issue close to 34 million new shares to Unefon shareholders, and the merger will leave at least 23% of Iusacell publicly traded, with the rest owned by the Salinas Group, the company said.