12.5 C
New York
Thursday, September 17, 2020
Home News Verizon purchases prepaid wireless provider Tracfone for around $7 billion

Verizon purchases prepaid wireless provider Tracfone for around $7 billion

The country’s largest MVNO has a new home.

verizon-logo-black-background.jpg

What you need to know

  • Verizon Wireless has reached a deal to purchase wireless re-seller Tracfone.
  • It includes $3.125 billion in cash, $3.125 billion in Verizon stock, and up to another $650 in cash.
  • Tracfone is the largest pre-paid wireless brand, touting 21 million subscribers.

Another big shift is taking place in the wireless space, with Verizon making the formal announcement on September 13 that it’s now entered an agreement to purchase Tracfone.

There’s a good chance you’ve heard of Tracfone before, and you might even use the company’s services yourself. It’s the largest wireless re-seller in the United States, offering affordable wireless plans through the main Tracfone brand and smaller sister brands — including Straight Talk, Simple Mobile, Total Wireless, Walmart FamilyMobile, and others.

Verizon is buying Tracfone for around $7 billion, with that being broken up into three main parts:

  • $3.125 billion in cash.
  • $3.125 billion in Verizon common stock.
  • $650 million in “future cash consideration related to the achievement of certain performance measures and other commercial arrangements.”

tracfone-website-hero-2019-joe.jpg

Commenting on the news, Verizon Chairman and CEO Hans Vestberg said:

This transaction is aligned with what we do best: providing reliable wireless service alongside a best-in-class customer experience. We are excited about the opportunity to bring Tracfone and its brands into the Verizon family where we can put the full support of Verizon behind this business and provide exciting and compelling products into this attractive segment of the market. We are pursuing this important strategic acquisition from a position of strength given our very strong and prudent financial profile.

Of the 21 million Tracfone customers, more than 13 million of them already have their service powered by Verizon’s network. It’s said that all Tracfone customers will have access to Verizon service “soon,” though it remains unclear if Tracfone’s other service options from AT&T and T-Mobile will continue to be available. Verizon will also expand its, 4G LTE and 5G services, in addition to “other innovative technologies.”

The deal is expected to be completed in the second half of 2021, pending regulatory approvals. We all know how long it took for the T-Mobile and Sprint merger to happen, and while this isn’t exactly the same type of acquisition, it’s still possible it’ll be faced with pushback and delays along the way.

Best Verizon Phones 2020

Latest

Keep you money and Samsung Galaxy Note 20 safe with one of a wallet case

One of the things we always have with us is our phone, so it makes sense to combine that with

How to watch Keeping up with the Kardashians Season 19 online

The Kardashian family may have announced that their long running reality TV series will be coming to end in 2021

Massive Samsung Galaxy S20 FE leak leaves nothing to the imagination

The Galaxy S20 FE will have a lot in common with the standard Galaxy S20.What you need to knowSamsung's product

Make sure you have the right transformer for your Ring Video Doorbell Pro

You need a 30VA transformer so your Ring Video Doorbell Pro will work properly, and the one in your house