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

Verizon is acquiring Frontier Communications for $20 billion to bolster its fiber network.

Verizon Communications Inc. said Thursday the transaction will also help the company expand into artificial intelligence and the Internet of Things.

Frontier has focused heavily on its fiber network capabilities over the past four years, investing $4.1 billion in upgrading and expanding its fiber network. It now derives more than half of its revenue from fiber products.

The price tag for Dallas-based Frontier is hefty considering its 2.2 million fiber subscribers in 25 states. Verizon has about 7.4 million Fios connections in nine states and Washington, D.C.

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

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

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 is subject to approval from Frontier shareholders.