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Verizon Buying XO's Fiber Business For $1.8 Billion

Verizon has announced that it will be buying XO Communications' fiber business in a deal pegged to be worth around $1.8 billion. According to the full XO announcement, pending regulatory approval the deal is expected to be finalized in the first half of 2017. XO is specifically selling the company's fiber IP and Ethernet networks, assets Verizon says will help "better serve enterprise and wholesale customers" as well as making the company's cell network denser and more efficient.

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In the announcement, XO Chairman Carl Icahn made note of the company's rocky history since its 2001 bankruptcy and 2003 emergence, something Icahn blames on "major network overcapacity and other issues caused by overly optimistic projections and capital expenditures made by previous owners."

"Although this sale to Verizon does not represent a significant annualized return on our investment, we believe that in today's environment it does represent the best achievable outcome for the company's customers, employees and owner," Icahn added.

In addition to the acquisition of XO’s fiber-based IP and Ethernet networks, Verizon said it will also lease XO's wireless spectrum with an option to buy.

Most recommended from 32 comments



ITALIAN926
join:2003-08-16

25 recommendations

ITALIAN926

Member

Spending

All this spending and Verizon cant offer their front-line workers a fair contract? This is a lot of investment, Verizon. How about investing in the future workforce and its morale?

Zenit_IIfx
The system is the solution
Premium Member
join:2012-05-07
Purcellville, VA
·Comcast XFINITY

6 recommendations

Zenit_IIfx

Premium Member

XO Network Map

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XO Network Map
I took a look at the XO network map and it overall seems to overlap the VZE network. This purchase must be about any middle or last mile fiber XO has serving customers, as the longhaul is duplicated.

Interesting that VZ is just leasing the wireless spectrum, why not just buy that? It would be more in line with the ideals of VZ's management (wireless over everything).