Verizon in talks to buy Alltel, says Vodafone
Friday, 6 June 2008
LONDON, June 5 (Reuters): Britain's Vodafone confirmed Thursday that Verizon Wireless, in which it has a 45 per cent stake, was in advanced talks about buying US rural mobile service provider Alltel Corporation.
Verizon Wireless is close to buying Alltel for around US$27 billion, including around $23 billion of its debts, a source familiar with the talks told the news agency Wednesday.
The deal would mean Verizon Wireless-which is 55 per cent owned by Verizon Communications -- would overtake AT&T as the top US wireless service.
Vodafone and Verizon Comms proportional ownership of Verizon Wireless will not change under an Alltel deal, the source said.
A Verizon deal would value Alltel at eight times its earnings before interest, tax, depreciation and amortization, compared with its November sale to private equity firms for about nine times EBITDA, the source said.
Some analysts said Verizon could be in a good position to refinance Alltel's debt at a lower interest rate; others said that a deal could also help Verizon create savings from a network and handset perspective.
Verizon Wireless is close to buying Alltel for around US$27 billion, including around $23 billion of its debts, a source familiar with the talks told the news agency Wednesday.
The deal would mean Verizon Wireless-which is 55 per cent owned by Verizon Communications -- would overtake AT&T as the top US wireless service.
Vodafone and Verizon Comms proportional ownership of Verizon Wireless will not change under an Alltel deal, the source said.
A Verizon deal would value Alltel at eight times its earnings before interest, tax, depreciation and amortization, compared with its November sale to private equity firms for about nine times EBITDA, the source said.
Some analysts said Verizon could be in a good position to refinance Alltel's debt at a lower interest rate; others said that a deal could also help Verizon create savings from a network and handset perspective.