News came after the closing bell on Wall Street this afternoon that Verizon is putting more money into wireless assets, while Consolidated Communications is putting more money into fiber.
Consolidated Communications, based in Mattoon, Illinois, said it plans to divest its limited partnership interests in five wireless partnerships managed by Cellco Partnership. Cellco Partnership is a wholly owned subsidiary of Verizon. Cellco will purchase Consolidated Communications’ interests for $490 million.
Consolidated plans to use the proceeds to support its fiber to the premises (FTTP) build plan.
For its part, Cellco will own $490 million more wireless assets, although it’s not immediately clear what those assets are comprised of. Verizon often lists Cellco as the bidding entity when it participates in spectrum auctions. For instance, Cellco was the entity that purchased $45.5 billion worth of C-band spectrum in 2021.
Consolidated is planning a conference call tomorrow morning in conjunction with its second quarter earnings report.
The sales are expected to close by the end of 2022, subject to certain closing conditions and third-party purchase rights available to other partners in the partnerships.
“The sale of these wireless investments is part of our long-term strategy as we continue our transformation to a fiber-first broadband company,” said Bob Udell, president and CEO of Consolidated Communications, in a statement. “Proceeds from these transactions will directly support our fiber expansion plan, our key strategic priority.”
Consolidated is putting a big focus on fiber. As of the end of Q1 2022, it passed nearly 690,000 locations with fiber, or approximately 25% of its service area. Udell said it planned to bump that up to 37% by the end of 2022 by targeting an additional 400,000 new fiber locations.