Verizon is buying Frontier in $20B deal to strengthen its fiber network

Verizon is buying Frontier Communications in a $20 billion deal to strengthen its fiber network.

Verizon Communications Inc. said Thursday that the acquisition will also shore up its foray into artificial intelligence as well as connected smart devices.

Frontier has concentrated heavily on its fiber network capabilities over about four years, investing $4.1 billion upgrading and expanding its fiber network. It now gets more than half of its revenue from fiber products.

The price tag for Frontier, based in Dallas, is sizeable given its 2.2 million fiber subscribers across 25 states. Verizon has approximately 7.4 million Fios connections in nine states and Washington, D.C.

Frontier has 7.2 million fiber locations and has plans to build out an additional 2.8 million fiber locations by the end of 2026.

“The acquisition of Frontier is a strategic fit," Verizon Chairman and CEO Hans Vestberg said in a prepared statement. "It will build on Verizon’s two decades of leadership at the forefront of fiber and is an opportunity to become more competitive in more markets throughout the United States, enhancing our ability to deliver premium offerings to millions more customers across a combined fiber network.”

There are skeptics of the potential for Verizon's $20 billion acquisition, however.

“The real issue is simply that Frontier’s paltry 3.5% national fiber coverage (again, according to the FCC’s broadband map as of end of 2023) would leave Verizon with a combined fiber footprint that still covers less than 13% of the country, with a path to potentially take that only to about 17% of the country,” Craig Moffett of MoffettNathanson Research wrote. “A fiber footprint covering 17% of the U.S. is nowhere near large enough to be the basis of a strategy for a national wireless operator.”

Verizon, based in New York City, will pay $38.50 for each Frontier share. The deal is expected to close in about 18 months. It still needs approval from Frontier shareholders.

Shares of Frontier Communications Parents Inc., which were halted briefly on Wednesday after a report from the Wall Street Journal about the deal sent the stock up nearly 40%, fell 9% Thursday. Verizon's stock dipped slightly.

FILE - A Verizon retail location is shown in Willow Grove, Pa., Thursday, Feb. 22, 2024. Verizon is buying Frontier Communications in a $20 billion deal that helps bolster its fiber network. (AP Photo/Matt Rourke, File)

BANGKOK (AP) — Shanghai's airports were canceling hundreds of flights Sunday as they brace for impact from Typhoon Bebinca, which is due to make landfall in the early hours of Monday morning, the authorities said.

Flights past 8 p.m. local time will be canceled at Hongqiao and Pudong airports in the city, airport officials said in a statement, affecting more than 600 flights. The city also announced that it was suspending travel on some bridges while restricting movement on other highways.

Typhoon Bebinca is a few hundred kilometers away from the coast.

The typhoon's winds are expected to reach 151 kph (nearly 94 mph) by Sunday night, according to the China Meteorological Administration, which has categorized it as a strong typhoon.

State media reported that 377, 000 people had been evacuated from across Shanghai. Meanwhile, in the nearby city of Zhoushan, restaurants, supermarkets and shops shut down early for the day, and public transportation services were halted.

The storm is expected to bring up to 10 inches (25.4 centimeters) of rain to parts of the eastern coast that will be hardest hit, according to state media.

In this photo released by Xinhua News Agency, a ferry terminal is closed as they brace for impact from Typhoon Bebinca, in Xiangshan County, east China's Zhejiang Province, Sunday, Sept. 15, 2024. (Jiang Han/Xinhua via AP)

A view of pink cloudy skyline is seen in Shanghai, China, Sunday, Sept. 15, 2024. (Chinatopix Via AP)