American telecom service provider AT&T has decided to sell its wireline business in Connecticut to Frontier Communications for $2 billion in cash.
The divestment of wireline net work – both consumer and enterprise – will not affect AT&T revenues.
The divested operations represent about $1.2 billion in annual revenues, or less than 1 percent of AT&T’s total annual revenues, as of 2013.
AT&T is currently evaluating the impact of this sale on its Project VIP projections but does not expect significant changes.
AT&T will utilize the proceeds of the deal for the Project VIP project. The project enables AT&T to expand its 4G LTE network to 300 million people across the U.S. and, in its remaining 21-state wireline service area, to expand U-verse high speed Internet and video services to more customer locations, and deploy its fiber network to more business customer locations.
About 2,700 wireline employees supporting AT&T’s operations in Connecticut will transfer with the business to Frontier at the close of the transaction. Frontier has agreed to honor the existing collective bargaining agreement for employees represented by the Communications Workers of America.
Connecticut-based Frontier Communications provides communications services to residential and business customers across 27 states today. The transaction enables Stamford-headquartered Frontier to now have operations to provide communications service to customers in the State of Connecticut.
Patricia Jacobs, president-AT&T New England, said: “We will continue to invest in Connecticut to serve wireless and business customers, will maintain a significant employee presence here and will continue to be involved in the community.”
As part of the deal, AT&T will transfer more than 900,000 voice connections, including U-verse Voice over IP and traditional voice services delivered over access lines; approximately 415,000 broadband connections, including 245,000 U-verse High Speed Internet and about 170,000 DSL customers and about 180,000 U-verse video subscribers.
