Mobile
News
4/30/2009
02:57 PM
50%
50%

Verizon Seeks Extension For Alltel Spinoff

The company says it needs more time to divest in wireless assets it obtained from Alltel because of difficulties related to the economic climate.

Verizon Wireless is seeking some more time to divest wireless assets it acquired when it purchased Alltel.

By purchasing the majority of Alltel for $28.1 billion last year, Verizon became the largest U.S. carrier, with about 80 million subscribers. Government agencies approved the deal with the requirement that Verizon divest in certain markets where its wireless assets overlapped.

The company's deadline was originally May 9, but Verizon has asked for an additional 60 days to complete the process.

"Although the company has diligently managed the divestiture process, the sheer size and complexity of the divestiture coupled with the current economic conditions have forced bidders to conduct far more due diligence than usual," Verizon said in an official filing. "This has made it impossible to complete the divestitures within the initial 120-day period."

Alltel is not finished as an independent carrier, though, as it will continue to provide wireless services to about 2.2 million customers in 22 states. It continues to grab new cell phones and smartphones, and it recently picked up the clamshell BlackBerry Pearl Flip.

With about 80% of U.S. customers already having cell phone service, the carriers are finding it increasingly tough to have organic subscriber growth. This may lead to more acquisitions, as the Alltel deal was a key factor in Verizon's strong first-quarter results because it added more than 13 million new subscribers.

Many are expecting U.S. Cellular to be the next major acquisition, as it has more than 6 million customers and is reportedly facing pressure to sell. Because it uses the CDMA technology for its network infrastructure, it could be an attractive target for Sprint Nextel or Verizon Wireless.


InformationWeek has published an in-depth report on the use of business software on smartphones. Download the report here (registration required).

Comment  | 
Print  | 
More Insights
InformationWeek Elite 100
InformationWeek Elite 100
Our data shows these innovators using digital technology in two key areas: providing better products and cutting costs. Almost half of them expect to introduce a new IT-led product this year, and 46% are using technology to make business processes more efficient.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest, Dec. 9, 2014
Apps will make or break the tablet as a work device, but don't shortchange critical factors related to hardware, security, peripherals, and integration.
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
Join us for a roundup of the top stories on InformationWeek.com for the week of December 7, 2014. Be here for the show and for the incredible Friday Afternoon Conversation that runs beside the program!
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.