Frontier has the finish line in sight. The state of Washington has approved the acquisition of Verizon’s local wireline assets in the state. Frontier only has Illinois and West Virginia left for statewide approval of the $8.5 billion deal which has Frontier acquiring 4.8 million access lines from Verizon.
Frontier and Verizon recently completed the financial engineering necessary to complete the deal as well. They secured a private placement offering of $3.2 billion in senior notes to help fund the complex transaction. “The market has spoken,” said Maggie Wilderotter, Chairman and CEO of Frontier. “The net proceeds from the offering are sufficient to fund the entire special cash payment that is one of the conditions to closing. The success of the offering is a gratifying demonstration of the continued confidence investors have in Frontier and our transformational transaction.”
Although Frontier and Verizon have run in to opposition over the transaction in both West Virginia and Illinois, they seem relatively confident the deal will close as planned. I suspect there’s some horse trading going on behind the scenes.