Verizon Wireless, a joint venture of
Verizon Communications Inc.
Vodafone Group Plc
), has hired Loop Capital as another advisor for the proposed 700
MHz wireless spectrum sale. The company is aggressively looking for
the sale of its 700 MHz A and B spectrum licenses, announced a
Loop Capital, along with Stephens Inc., will reach to a wide
range of potential bidders.It seems that
), the second largest wireless provider, and
MetroPCS Communications Inc.
) will be the likely bidders. T-Mobile, a unit of
) is not interested in the airwaves offered by Verizon.
The move will aid Verizon to gain regulatory approval for its
proposed $3.9 billion purchase of wireless spectrums from several
cable companies including
Time Warner Cable
), Bright House Networks and Cox Communications. The pending
purchase, announced in December last year, is facing stiff
opposition, in particular from T-Mobile,
Sprint Nextel Corp.
) and 10 other public interest groups.
They argued that the purchase would lead to the concentration of
spectrums in the hands of Verizon, which is already the largest
U.S. mobile service provider with the maximum number of licenses.
The deal would also allow the cross selling of each other's
products and services, and raise concerns among some politicians
and consumer advocacy groups.
Verizon believes that the unused spectrums of the cable
companies are more beneficial than the 700 MHz airwaves. The
purchase of new spectrum will double Verizon's capacity and provide
services at a much higher speed, thereby driving data revenues and
boosting its competitive position.
However, the sale of the 700 MHz airwaves depends on the
successful completion of pending spectrum purchases from cable
companies expected in mid-summer.
We are maintaining our long-term Neutral recommendation on
Verizon. Currently, the stock retains the Zacks #3 (Hold) Rank for
the short term (1-3 months).
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