Frontier Communications shareholders have voted to approve the company’s acquisition of Verizon’s local exchange businesses in 14 states, as well as certain related customer relationships.
Shareholders also voted to increase the number of authorized shares of Frontier common stock.
Various state regulators still need to ok the deal, but Frontier is confident the deal will be closed during the second quarter of 2010.
In May, Frontier offered Verizon $8.5 billion in stock to buy 4.8 million access lines in the 14 states. Frontier yesterday said it will issue shares to Verizon stockholders equal to $5.2 billion, and Verizon will receive $3.3 billion in the form of a special cash payment to boot.
The Communications Workers of America has come out in strong opposition to the impending deal. The union claims the buyer will end up being short on cash and that it is too small to integrate Verizon’s systems efficiently.
Frontier Communications is a provider of communication services to rural areas and small and medium-sized towns and cities. The access lines it is aiming to purchase from Verizon are located in Arizona, California, Idaho, Illinois, Indiana, Michigan, Nevada, North Carolina, Ohio, Oregon, South Carolina, Washington, Wisconsin, and West Virginia.
I have a strong feeling this will be Frontier’s Waterloo.
Frontier == Fairpoint?
There is a reason Verizon is getting out of this business. It’s costs are going to soar as they need to maintain the all those wires on a declining base of customers.
Fairpoint sucks. The minute they took over in N.H. everyone I know dropped them and went back to the bundles at crappy Comcast.
The hope to have FiosTV and someone to compete against Crapcast ended.
Stuff like this is a step backwards.
As a person stuck living in a town with Frontier’s service I can tell ya this, their INTERNET SUCKS.
They wanted 60/month for a 3mbps DSL line which didn’t include their ‘required’ basic phone service. They also offered me a 6mbps DSL line for 100.00/month. Needless to say it leaves me stuck on Time Warner.
They also have this lovely marketing department who likes to send everyone notices saying “sign up for DSL today” even in areas they don’t provide it with just about every bill they send out. Really confuses and pisses off the less advanced net users in rural areas to get a notice saying to sign up for DSL then they call and find out they can’t get it.
I agree with Joel. With the recent bankruptcy filing of Fairpoint, can Frontier be that far behind?
I have not seen the financials for Frontier, but it’s hard for me to see how they can consume such a huge part of Verizon’s network.
I live in Portland and love their Fios service. Not sure if Frontier is up to the job of maintaining and expanding the fiber optic network.
It should be noted that in at least some states, the purchase includes fiber (FiOS). Specifically, Oregon and Washington.
Thats what concerns me.
As a former Frontier customer (phone only, which I dumped really quickly after dealing with their abysmal customer service when I tried signing up for DSL), I commiserate any affected Verizon customers.