US telecoms giant Verizon Wireless confirmed last night it is to acquire Alltel in a transaction valued at US$28.1bn, which will put Verizon on the path to rolling out fourth-generation Long Term Evolution (LTE) technology.
Verizon Wireless, which is a joint venture between Vodafone and Verizon Communications, has agreed to acquire the equity of Alltel for US$5.9bn. Based on Alltel’s projected net debts of US$22.2bn, the aggregate value of the transaction is US$28.1bn.
The deal will result in Alltel’s 13 million US customers in 57 states being able to access over-the-air, downloadable music services and other breakthrough technology services.
“This move will create an enhanced platform of network coverage, spectrum and customer care to better serve the growing needs of both Alltel and Verizon Wireless customers for reliable basic and advanced broadband wireless services,” said Lowell McAdam, Verizon Wireless president and chief executive officer.
The companies are targeting the completion of the merger for the end of this year, depending on regulatory approval.
Alltel and Verizon both use a common network technology, which will make it easier to integrate Alltel’s customers.
The deal will put the Alltel customer base on a track to advanced fourth-generation services as Verizon deploys LTE technology over the next seven years.
“Both Alltel and Verizon Wireless have long track records of delivering a high-quality customer experience in the marketplace,” said Alltel CEO, Simon Ford.
“The combination of our two companies will continue and improve upon that heritage as, together, we can more quickly deliver an expanded range of innovative products and services to our customers,” Ford added.
By John Kennedy