UPDATED: Verizon to Acquire Alltel In $28 Billion Deal

by Lance Turner and Jamie Walden  on Thursday, Jun. 5, 2008 10:25 am  

Verizon says it will buy Alltel Corp. of Little Rock.

(THVideo: Click here for an Arkansas Business video report on "Today's THV at Noon" on Verizon's move to buy Alltel.)

A day after reports leaked that the two companies were in talks, Verizon Wireless announced Thursday that it will buy Alltel Corp. of Little Rock in a deal worth $28 billion.

In a news release, Verizon said it will acquire the equity of Alltel for about $5.9 billion. "Based on Alltel's projected net debt at closing of $22.2 billion, the aggregate value of the transaction is $28.1 billion," the news release said. The companies want the merger to clear by the end of the year.

Alltel President and CEO Scott Ford talked about the deal at a 2 p.m. news conference. Click here for video of the news conference.

3,200 Workers in Arkansas

The deal throws into question what will happen to Alltel's 3,200 employees in Arkansas, including the hundreds at its headquarters on Riverfront Drive. Alltel is the state's 15th largest employer, according to Arkansas Business' latest list of the state's largest employers

Neither company has indicated plans for its workforce post-merger.

"The way these things happen, you don't get into the future planning until you announce a deal, and then you really don't get into communicating what's going to happen in the future until after you close it," Verizon spokesman Jim Gerace told ArkansasBusiness.com.

In an e-mail to employees on Thursday announcing the sale, Alltel told employees "there will be no immediate impact on your job." The e-mail said the sale was "the best way - long-term - to provide not only for our customers but for the majority of our employees as well."

(Click to see Alltel's e-mail to employees about the merger.)

With its substantial payroll, real estate holdings and community involvement, Alltel is a key corporate citizen in Little Rock, as well as the state. In a statement released by Gov. Mike Beebe's office this afternoon, Beebe said the state welcomes Verizon's expanded presence here.

"While Verizon Wireless has already been providing service here for several years, it will now have a more complete picture of Arkansas hospitality and the commitment of our workforce," Beebe said. "In acquiring Alltel, Verizon is obtaining a company with deep Arkansas roots and qualified, dedicated employees. I hope those attributes will resonate strongly as decisions are made about how best to incorporate Alltel into the Verizon family."



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