Verizon Wireless takes number one spot in US

12 Jan 2009

As expected, Verizon Wireless completed its USD28.1 billion buyout of smaller rival Alltel Corp on Friday. The deal creates the largest wireless operator in the US with 83.7 million subscribers following the planned divestiture of 2.1 million customers on former Alltel networks which are being sold because they are in areas also served by Verizon Wireless. Up to 3,000 Alltel executives could face redundancy as Verizon looks to trim the enlarged company’s workforce. Both Verizon and Alltel operate via CDMA-based networks so customers will be largely unaffected by the tie-up; the Alltel brand will be retained for the next few months, with a rebranding programme to begin in 2Q09. Verizon announced its intention to buy Alltel last June, saying it would pay USD5.9 million while assuming USD22.2 billion of debt. It expects to realise synergies with a net present value, after integration costs, of more than USD9 billion, driven by aggregate capital and operating expense savings. Alltel was previously owned by private equity groups TPG Capital and GS Capital Partners. The US cellular market’s former number one player, AT&T Mobility, claimed just under 75 million users at end-September according to TeleGeography’s GlobalComms database.

United States, Alltel Corporation, Verizon Wireless