Following the purchase of Alltel, it was no secret that Verizon would have to unload some of its new properties in order to keep things legal. Now AT&T – just as expected – has offered take some of that additional property off Verizon’s hands to the tune of several million dollars. The end result of the deal is that the two wireless companies essentially swap properties, with a little cash thrown into the mix.
AT&T sold some of the wireless assets of Centennial Communications Corp. for the whopping sum of $240 million dollars. According to the press release: ” Verizon Wireless will acquire former Centennial wireless properties, including licenses, network assets and nearly 120,000 current subscribers, in five service areas in Louisiana and Mississippi. The five service areas are Lafayette, La., LA-5 (Beauregard), LA-6 (Iberville), LA-7 (West Feliciana) and MS-8 (Claiborne). AT&T expects this sale of assets to Verizon Wireless will resolve certain potential overlap issues between AT&T’s existing footprint and Centennial’s properties and help advance final regulatory approval of the Centennial acquisition. AT&T’s sale of wireless assets to Verizon Wireless is also contingent upon regulatory approval and is expected to close in the fourth quarter of 2009.”
In exchange AT&T is handing over a staggering $2.35 BILLION in cash to Verizon in exchange for ” wireless properties, including licenses, network assets and 1.5 million current subscribers in 79 service areas, primarily in rural areas across 18 states. Verizon Wireless is required to divest these properties as part of the regulatory approvals granted for its purchase of Alltel earlier this year. The states represented are: Alabama, Arizona, California, Colorado, Iowa, Kansas, Michigan, Minnesota, Montana, Nebraska, Nevada, New Mexico, North Dakota, South Dakota, Tennessee, Utah, Virginia and Wyoming.”
That is a huge deal. While all of it is being done to help ensure that Verizon doesn’t hold a monopoly in the US, it also puts customers in those areas in a situation where they might not have a choice at all in who provides them with wireless service. It doesn’t seem exactly fair that they can just be passed off without having at least a little say in the matter.
Are you in one of the affected areas for the trade/buy? What are your thoughts?