Verizon Buys AllTel In $28.1 Billion Deal

June 5th, 2008 at 12:00 am
 


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Verizon Wireless and AllTel Communications have confirmed the acquisition of the latter for $28.1 Billion.

The union of Verizon and Alltel put them at number one pushing AT&T to number two followed by Sprint Nextel and T-Mobile. Along with the acquisition of AllTel, Verizon now has 80 million subscribers.

However, Verizon will also be assuming the debts of AllTel which amount to about $22.2 billion. Actually the remaining $5.9 billion of the total price tag is AllTel’s equity. The deal will be completed later this year.

“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.

As in most mergers, especially in banks, the customers of the merging companies get the best of both worlds. Once this transaction closes, customers of both companies will have access to an expanded range of products and services, including a premier lineup of basic and advanced devices and an expanded IN Network calling community. Alltel customers also will benefit from advanced services including over-the-air downloadable music from a three-million-song library, and a network that is nationwide, for a uniform coast-to-coast experience. They also will be able to take advantage of industry-leading consumer policies, including Test Drive and Worry Free Guarantee®. [Press Release ]

With Verizon now having the most customers, will AT&T do something drastic or acquire somebody else to regain its lead? Or perhaps, AT&T isn’t at all worried, Verizon having inherited a debt and all?

On the service side, Verizon users will be enjoying wider coverage and cheaper rates within the most number of subscrers of in a single network.