FCC OKs Verizon Asset Sale To Frontier
May 21, 2010
| 4:06 PM
Verizon won FCC approval Friday to spin off its rural wireline assets in 14 states to Frontier Communications -- but only after the agency imposed extensive conditions on the $8.6 billion transaction in an effort to safeguard consumers and smaller competitors.
"The commission concluded that the commitments that applicants have offered, coupled with monitoring and enforcement by the commission, will minimize the risks of harm and ensure that this transaction is in the public interest," the agency said.
Senate Commerce Chairman John (Jay) Rockefeller, D-W.Va., whose home state of West Virginia would be directly affected, asked the FCC late last year to closely scrutinize the deal.
Last week, Verizon and Frontier promised to abide by an additional 21 commitments, the investment firm Stifel Nicolaus said Thursday. The spin-off has been approved by the nine states that required regulatory reviews, with the Public Service Commission of West Virginia green lighting the deal May 13. The West Virginia commission imposed several conditions on Frontier, including a requirement that it make $279 million in capital investments in West Virginia through 2013.
Verizon is the nation's second largest telecommunications provider, while Frontier would emerge as the country's fifth largest local exchange carrier.
"This transaction will benefit consumers by enabling Frontier to strengthen its position as a premier broadband and communications provider focused on rural and small- to medium-sized cities," Kathleen Grillo, Verizon's senior vice president of federal regulatory affairs, said in a statement. "It also will allow Verizon to accelerate its focus on wireless, broadband and global IP networks for its customers."
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