Frontier Communications Corp. (FTR) on Wednesday said it has agreed to buy 4.8 million of Verizon’s access lines in 14 states. The deal will turn Frontier into the largest rural communications provider in the United States.
“We are confident that we can dramatically accelerate the penetration of broadband in these new markets during the first 18 months,” Frontier Chairman and CEO Maggie Wilderotter said, in a prepared statement.
Verizon’s shareholders, not Verizon, will receive enough stock to give them an approximately 68 percent stake in the combined company. Including debt, the deal is valued at around $8.6 billion. In addition, 11,000 or so Verizon employees will become Frontier workers.
Both companies’ boards already have approved the transaction, which is expected close in about 12 months.
Verizon has a track record of moving away from rural landlines. It’s already sold most of its New England wireline assets to FairPoint Communications Inc. (FRP), which has had trouble integrating them.