Verizon Close To $27 Billion Deal For Alltel

Verizon (VZ), the No. 2 U.S. telco, is close to a $27 billion deal for Alltel, CNBC’s David Faber reports. If true, this makes plenty of sense:

  • A deal for Alltel, the No. 5 U.S. wireless carrier, would make Verizon the biggest carrier with 80 million wireless subscribers, ahead of AT&T’s 71 million. Scale is important in the wireless business, both for cost savings and leverage.
  • If the $27 billion total is accurate, it’s a good deal. TPG and Goldman Sachs Capital Partners spent $27.5 billion take it private last year.
  • Verizon and Alltel both operate CDMA networks, which means their phones and towers are interchangeable.
  • Verizon would save money it spends on roaming charges when its subscribers are on Alltel’s network, which covers huge parts of the U.S.

More to come as details emerge…

See Also:
Verizon Wireless CEO: ‘Open’ Access Won’t Cost More
Verizon Wireless CEO, FCC Chair: Be Patient! We’re Improving Telecom As Fast As We Can
Verizon Snubs Google For Rival Mobile Linux Group

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