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Frontier Buys Verizon's California, Florida and Texas Wireline Business for USD 10.54bn.

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Vincent

MANews-(C)2009-2015

6 February 2015 - US-based telecommunications company Frontier Communications Corp. (NASDAQ: FTR) has inked a definitive agreement with Verizon Communications Inc. (NYSE: VZ) under which Frontier will acquire Verizon's wireline operations that provide services to residential, commercial and wholesale customers in California, Florida and Texas, for USD 10.54bn in cash, the company said.

These Verizon properties include 3.7m voice connections, 2.2m broadband connections, and 1.2m FiOS video connections.

The network being acquired is the product of substantial capital investments by Verizon and is 54% FiOS enabled. Subject to regulatory approval, the transaction is expected to close in the first half of 2016.

Under the terms of the transaction, Frontier will pay Verizon USD 10.54bn in cash at closing, representing 3.7x 2014E Pro Forma Day 1 EBITDA.

Frontier will finance this acquisition with the issuance of a combination of equity and equity-linked securities, as well as debt. Frontier said it has secured a commitment for bridge financing from J.P. Morgan, Bank of America Merrill Lynch and Citibank for 100% of the purchase price.

The transaction is not subject to a financing condition. However, it is subject to regulatory approvals and customary closing conditions, including review by the US Federal Communications Commission, the US Department of Justice, and certain governmental authorities in the states...

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