Verizon and Alltel join hands
Vodafone stays in background of $28bn deal
Verizon's parent Vodafone has confirmed the second largest mobile operator in the US will soon take the top spot by acquiring Alltel for a total of $28.1bn.
The deal will see Verizon's subscribers base jump up to 80.4 million, making it the biggest in the USA when compared to AT&T's 71.4 million, but also giving it access to many rural areas where it lacks coverage. All this at a cost of less than $6bn in cash and responsibility for $22.2bn of Alltel's debt.
This morning we reported that a deal was on the table, and most of the details were accurate.
Verizon reckons it can save $9bn in synergies - laying off people in duplicate jobs, and removing some cell sites where both companies currently have coverage. Verizon and Alltel already have roaming agreements in place, and run compatible CDMA networks, so customers should have a fairly smooth transition.
Vodafone remains a minority partner what will be the largest US network operator. The UK-based company owns 45 per cent of Verizon Wireless, the rest belonging to Verizon Communications Inc, and there's no sign of the Vodafone branding on the other side of the pond, at least not yet.
The deal will still have to face regulatory approval, both the Department of Justice and the Federal Communications Commission will want a say in the agreement, but that's expected to be done and dusted by the end of this year. ®