14 DAY TRIAL // Verizon Communications Inc. has recently announced that the acquisition of cellular carrier Alltel Corp. by Verizon Wireless is expected to close on January 9th. The $5.9 billion deal has been announced in June, and is supposed to make Verizon Wireless the largest wireless carrier in the country, as it will have around 78 million subscribers.
Verizon Wireless was formed as a joint venture between Vodafone Group PLC of the U.K. and Verizon Communications of New York. Initially, Verizon Wireless tried to close the deal with Alltel before the end of 2008, yet it seems that the regulatory review stretched longer than expected, well into December. Verizon Wireless is also reported to have pledged to sell assets where its network and Alltel's overlap, as a means to gain approval for the transaction.
Besides the $5.9 billion Verizon Wireless is paying for Alltel's privately held equity, the company will also assume $22.2 billion in debt. Verizon announced in December that, although the credit markets were rough, it managed to receive commitments from eight institutions for $17 billion of financing.
Alltel, the fifth-largest wireless carrier in the United States, is based in Little Rock, Ark. According to Verizon, a call center will be located in Little Rock, yet many of Alltel's 3,000 employees will probably lose their better paying jobs in the city. The company's network is covering mainly the interior of the country, as it was built starting from rural areas and then spreading towards cities.
Back in August, Verizon President And Chief Executive Lowell McAdam stated that it would take the company a year after the deal was closed to decide which positions would be cut and which kept. A Verizon spokesperson is reported to have said that more information would be provided on the closing date. An Alltel spokesman is also stated to have mentioned that more details on the jobs would be unveiled after the closing.