Verizon Wireless Agrees to Purchase Qwest PCS Licenses and Wireless Network Assets

[jones]

Verizon Wireless Agrees to Purchase Qwest PCS Licenses and Wireless Network Assets for $418 Million Cash
Thursday July 1, 4:07 pm ET


DENVER--(BUSINESS WIRE)--July 1, 2004--Qwest Communications International Inc, (NYSE: Q - News) and Verizon Wireless today announced an agreement for Verizon Wireless to acquire Qwest's PCS licenses and related wireless network assets in 14 states.
The transaction is expected to close by year-end or early 2005, and will not impact new or existing Qwest wireless customers. Qwest will continue to offer wireless service under the Qwest brand to residential and business customers through its wholesale relationship with Sprint PCS.

Under the terms of the agreement, Verizon Wireless will pay $418 million in cash to purchase PCS licenses (1900 MHz) in 14 western states. In addition, Verizon Wireless will also obtain cell sites and wireless network infrastructure, site leases, and associated network equipment.

"The sale completes our shift from a network-centric wireless provider to a more customer-focused operation that is designed to deliver exceptional value and service to customers," said Oren G. Shaffer, Qwest vice chairman and chief financial officer. "The monetization of the network assets further improves our liquidity."

The sale is contingent upon federal regulatory approval. JP Morgan acted as a financial advisor to Qwest.

[Frito]

Nice find jones! This is great news for Verizon Wireless, they need to increase thier native Foot Print in the west. Plus this might help possible capacity issues some claim to have.

[larry]

So basically Sprint gets to pick and choose whatever Qwest cell sites they want and Verizon gets what's leftover plus the PCS licenses. I would have guesses Cingular would be the one to want to make this deal. Interesting.

[jayc]

Originally Posted by larry

So basically Sprint gets to pick and choose whatever Qwest cell sites they want and Verizon gets what's leftover plus the PCS licenses. I would have guesses Cingular would be the one to want to make this deal. Interesting.

You have to admit, it's one helluva deal for VZW... way under analyst's predictions on what it would bring.

[Frito]

Leftovers are just as good! I would care more about the PCS Freq.'s then anything else, specily since we have EV-DO comeing real soon, they are gonna need it!

[larry]

Originally Posted by jayc

You have to admit, it's one helluva deal for VZW... way under analyst's predictions on what it would bring.

Yes Verizon made out good on this one. What happened to Cingular I wonder?

[larry]

Originally Posted by Frito

Leftovers are just as good! I would care more about the PCS Freq.'s then anything else, specily since we have EV-DO comeing real soon, they are gonna need it!

There are many Qwest cell sites that Sprint didn't need because they were either co-located together or in close proximity to one or another. So I would imagine there are many that will go to Verizon.

[jayc]

Verizon Wireless and Qwest have signed a definitive agreement for Verizon Wireless to purchase Qwest's spectrum licenses and network assets in the following 62 markets:

Southwest
Phoenix, AZ
Tucson, AZ
Prescott, AZ
Flagstaff, AZ
Albuquerque, NM
Santa Fe, NM
Nogales, NM

West Rockies
Salt Lake City-Ogden, UT
Provo-Orem, UT
Boise-Nampa, ID
Idaho Falls, ID
Twin Falls, ID
Pocatello, ID
Lewiston-Moscow, ID
Billings, MT
Bozeman, MT
Great Falls, MT
Helena, MT
Missoula, MT
Butte, MT

East Rockies
Denver, CO
Colorado Springs, CO
Fort Collins-Loveland, CO
Grand Junction, CO
Greeley, CO
Pueblo, CO
Casper-Gillette, WY
Cheyenne, WY
Riverton, WY

Midwest
Omaha, NE
Lincoln, NE *
Fergus Falls-Alexndra, MN *
Rochester-Austin, MN *
Minneapolis-St. Paul, MN
Willmar-Marshall, MN *
St. Cloud, MN *
Sioux City, IA
Fargo, ND
Bismarck, ND
Rapid City, SD
Scottsbluff, NE *
Grand Island-Kearney, NE *

Oregon
Portland, OR
Eugene-Springfield, OR
Salem-Albany-Corvallis, OR
Bend, OR
Klamath Falls, OR
Medford-Grants Pass, OR
Roseburg, OR
Walla Walla, WA-Pendelton, OR
Coos Bay-North Bend, OR *

Washington
Bellingham, WA
Seattle-Tacoma, WA
Olympia-Centralia, WA
Longview, WA *
Spokane, WA
Bremerton, WA
Wenatchee, WA
Port Angeles, WA
Kennewick, WA
Aberdeen, WA
Yakima, WA

* New Markets for Verizon Wireless

I would say Cingular stockholders aren't interested in another aquisition YET. Does anybody have a map of Qwest's pre-sprint coverage area?

[bobolito]

I think Cingular has enough in their plate right now by buying AWS. Besides, I don't think Cingular would be interested in a CDMA network.

[Frito]

Oh ok i see larry. So Sprint did not take the overlapping sites is what you are saying? How is that whole sprint-quest transition going anyhow? Has it been relativley smooth for both ends?

[agentHibby]

Does Verizon get a swiss cheese network for the most part?? I think in some markets qwest wireless network was swiss cheese in many parts already??
Does Sprint keep the towers where Qwest has a network and Sprint PCS does not?? Does Verizon get them?? or do they share??

[larry]

In order for Qwest to move their customers over to Sprint they had to have sold their towers to Sprint in those areas that Sprint didn't already have a system built or the deal between them wouldn't work. So in theory Sprint would get all or most of their towers in Montana, Wyoming, and the Dakotas. Sprint would also get first dibs on any other towers they needed in the other markets such as in Phoenix, Denver, Seattle, etc. where they might have coverage but Qwest had better coverage.

Qwest is not known to be one of the better networks that exsist so Verizon would likley have to add some new sites.

[AnthroMatt]

In markets such as Phoenix, where Verizon already has a network, the Qwest infrastructure is a quick way to supplement your existing coverage. In such instances, it wouldn't necessarily matter how good Qwest's network was.

[larry]

True it won't matter how bad Qwest is in markets where Verizon already has service.

[Fathead]

This is interesting. Rumor had it that with the DOE site here in East ID (and hence a lot of high end government users), verizon is very interested in launching EV-DO here early, but was worried about spectrum. Getting qwest's spectrum would definately eliminate the worry.