Verizon strikes USD6.25bn TracFone takeover

15 Sep 2020

Verizon Communications has entered into an agreement to acquire 100% of US MVNO TracFone Wireless from Mexican telecoms group America Movil. TracFone is currently the largest reseller of wireless services in the US and served 20.918 million subscribers as of 30 June 2020. A long-time wholesale partner of Verizon, more than 13 million TracFone subscribers are currently said to utilise Verizon’s wireless network.

The total USD6.25 billion consideration for the transaction will include USD3.125 billion in cash and USD3.125 billion in Verizon common stock, subject to customary adjustments. The agreement also includes up to an additional USD650 million in future cash consideration related to the achievement of certain performance measures and other commercial arrangements. The deal is subject to receipt of regulatory approvals and other customary closing conditions. Verizon expects the transaction to close in the second half of 2021.

TeleGeography notes that TracFone currently operates via a number of pre-paid brands, which include: TracFone, NET10, Straight Talk, Total Wireless, Simple Mobile, Page Plus Cellular, Walmart Family Mobile and Telcel America. In addition, the SafeLink brand is part of the government subsidised Lifeline programme.