Verizon has agreed to sell 1.5 million of the 2.2 million Alltel wireless subscribers it was mandated to shed as a condition of their Alltel acquisition to AT&T for $2.35 billion. The deal includes the network and spectrum assets in 79 markets across 18 states. In a separate transaction, Verizon is buying some wireless markets from AT&T that were acquired from AT&T’s Centennial acquisition. AT&T apparently beat out a few private equity buyout firms for the Alltel markets.
The Alltel subscribers are in primarily rural markets (although not entirely) across Alabama, Arizona, California, Colorado, Iowa, Kansas, Michigan, Minnesota, Montana, Nebraska, Nevada, New Mexico, North Dakota, South Dakota, Tennessee, Utah, Virginia and Wyoming. The move may bring the venerable iPhone to some rural markets that currently do not have that option. “After operations transition to AT&T, the primarily rural subscribers added through this transaction will be able to experience mobile broadband on all the smartphones AT&T offers,” said AT&T in a company statement. That won’t happen soon though. AT&T’s wireless network is GSM based. The new Alltel markets are CDMA based, requiring a network migration.
The fate of the remaining Alltel assets, which includes about 700K subscribers, was not disclosed. Interested bidders include consortia of rural operators interested in picking up Alltel’s remaining rural wireless assets.