Verizon Wireless To Acquire Alltel For $28.1 Billion

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imageAs first rumored yesterday, Verizon (NYSE: VZ) is acquiring Alltel (NYSE: AT) equity and debt in a transaction worth $28.1 billion. Release.

Verizon Wireless issued a press release just moments ago, detailing the transaction between itself and it’s minority owner Vodafone (NYSE: VOD) and Alltel, which once completed will make it the largest U.S. wireless operator. Verizon will purchase Alltel from private-equity partners TPG Capital and GS Capital Partners, for about $5.9 billion in cash and will assume Alltel’s debt, which is estimated to be $22.2 billion, making the total transaction value $28.1 billion. The deal is expected to close by the end of the year, pending regulatory approvals. Rumors of the merger cropped up yesterday, however, the timing of the deal is surprising. Alltel was always a potential buy-out candidate for Verizon because they used the same network technology, but why now? One might suspect that Verizon was increasingly resigned to the fact that it was never going to catch-up to AT&T (NYSE: T), which has a runaway hit in selling Apple’s (NSDQ: AAPL) iPhone. Together, Verizon Wireless and Alltel will have 80.2 million subscribers, surpassing AT&T

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Rebecca Bowman

As an Alltel customer I am unhappy about this merger. Verizon services in my area of North Carolina are subpar at best. My significant other was a Verizon customer and switched to Alltel due to the number of dropped calls and the inability to make phone calls in our own home. Recently we both have noticed some oddities in our Alltel service, chiefly loss of signal and dropped calls. If this is the standard that Alltel will drop to in order to merge with Verizon, many customers in North Carolina would be better off with two tin cans and some string.

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