NEW YORK – Verizon Communications is selling its local wireline operations in predominantly rural areas in 14 US states to Frontier Communications.
The deal, paid for with US$5.3 billion worth of company stock, will allow Verizon to focus on “the fastest-growing parts of its business” such as wireless, broadband, fiber-based wireline (FiOS) and global IP, the company said in an announcement.
The transaction will also “strengthen Frontier’s position as a premier rural communications provider” while tripling it in size.
Frontier, based in Stamford, Conn, currently has approximately 2.3 million access lines in 24 states, providing local and long-distance voice, broadband data, and video services. This deal will give it an additional 4.8 million local residential and small business phones lines, plus 1 million broadband connections.
Approximately 11,000 Verizon company employees – those who primarily support the local phone business that is being acquired – will continue employment with Frontier after the merger, the announcement continued.
The companies said that they hope to complete the transaction in approximately 12 months. It requires approval from Frontier shareholders, certain regulatory approvals and “satisfaction of other customary closing conditions”, including the obtaining of financing.
