Fresh off its acquisition of AT&T’s Connecticut wireline business, Stamford’s Frontier Communications said it will pay $10.54 billion for Verizon’s wireline assets in California, Florida and Texas.
Frontier said the deal expands its footprint in key competitive suburban markets.
As part of the acquisition, Frontier adds 3.7 million voice connections, 2.2 million broadband connections, and 1.2 million FiOS video connections. The assets generated more than $5.7 billion in revenue last year.
Frontier said it expects to reduce operational costs by $525 million in the first year, and by $700 million in the third year because Verizon has higher overhead costs.
Frontier said it will finance the deal by issuing equity, equity-linked securities, as well as debt. The company said it has a commitment for bridge financing from J.P. Morgan, Bank of America Merrill Lynch and Citibank.
The deal is subject to regulatory approvals, and Frontier hopes to close it in the first half of 2016.
In 2009, Frontier paid $8.6 million to buy Verizon landlines in 13 states.
