Verizon, the final Frontier: Landlines, TV, ISP biz to explore strange new worlds
$10.5bn buyout in three US states clears final hurdle
US telco Frontier Communications has cleared its final hurdle towards a $10.54bn deal that will see it take over Verizon's landline phone, TV, and ISP business in California, Texas, and Florida.
Frontier said it has gained approval for the deal from the California Public Utilities Commission (CPUC), adding the final piece to approvals given by the Texas Public Utility Commission, the US Department of Justice (DOJ) and the Federal Communications Commission (FCC).
The acquisition deal will give Frontier control over 3.7 million Verizon wireline phone subscribers, 2.2 million video service subscribers, and 1.2 million FiOS broadband internet customers for both residential and business services.
Customers have been assured that services will not be disrupted by the acquisition. Following closing of the deal, Frontier said it will maintain the existing services in the three states and also allow Verizon customers to add or switch to its other service options.
"With this final approval, we look forward to completing our transaction with Verizon, which represents a significant transformation for Frontier," Frontier CEO Daniel McCarthy said of the deal.
With regulatory approval now wrapped up, Frontier is all cleared to finalize the transaction, something the company hopes to do by end of March 2016. The deal was first announced in February of this year.
Taking over in the three most populous US states (California, Texas, and Florida hold a combined 26 per cent of the total US population) would be seen as a major expansion for Frontier in the US and, according to the company, would effectively double its subscriber base. Frontier estimates that the Verizon operations in the three states accounted for more than $5.7bn last year.
Verizon, meanwhile, has been widely reported to be trying to shed some or all of its enterprise network businesses. Last month, multiple reports suggested that on top of the Frontier deal, Verizon was hoping to unload more of its enterprise network services for another $10bn. ®