Verizon Communications Inc. is acquiring Frontier Communications in a $20 billion deal to enhance its fiber network capabilities
Verizon also plans to expand into artificial intelligence and connected smart devices with the deal.
Driving the news: Frontier has heavily invested in upgrading its fiber network, spending $4.1 billion over four years, with over half of its revenue now coming from fiber services.
- Frontier, based in Dallas, has 2.2 million fiber subscribers across 25 states, while Verizon currently has approximately 7.4 million Fios connections in nine states and Washington, D.C.
The big picture: Verizon will pay $38.50 for each Frontier share, with the deal expected to close in approximately 18 months pending approval from Frontier shareholders.
- Following the announcement of the deal, shares of Frontier Communications Parents Inc. experienced a 9% decline, while Verizon’s stock saw a slight decrease.
What they’re saying: “The acquisition of Frontier is a strategic fit,” Verizon Chairman and CEO Hans Vestberg said in a statement. “It will build on Verizon’s two decades of leadership at the forefront of fiber and is an opportunity to become more competitive in more markets throughout the United States, enhancing our ability to deliver premium offerings to millions more customers across a combined fiber network.”
