Verizon Wireless announced Thursday it would purchase 50 PCS wireless licenses from
Long Island, NY, cable provider Cablevision Systems
, for about $750 million in cash.
Verizon Wireless, a joint venture between Verizon Communications
and UK’s Vodafone Group, said it signed an agreement with Northcoast Communications LLC, an affiliate of Cablevision, to purchase the licenses and related network assets.
The licenses help Verzion, the nation’s largest wireless carrier, bolster its cellular coverage in major markets such as New York, Boston, Minneapolis, Columbus, Ohio, Providence, R.I., Rochester, NY and Hartford. The cash transaction is expected to close during the second quarter of 2003.
Cablevision said about $60 million would be used to retire Northcoast FCC-related debt and that the balance of the proceeds would be distributed to Northcoast’s partners, which are comprised of Northcoast PCS and a subsidiary of Cablevision Systems Corporation. Cablevision said it would use its share, about $635 million, to pay down bank debt.
Cablevision has long signaled its interest in selling the wireless
licenses and analysts have been eager to see the cable company offload the assets in order to raise operating cash. Analysts that follow the company have been eager to see the sale happen, especially as Cablevision gears up to launch a direct broadcast satellite (DBS) service by March of 2003, as it has stated publicly.
In a statement, Denny Strigl, president and CEO of Verizon Wireless, called the radio spectrum it got with the licenses “the lifeblood of our industry. With additional spectrum we can continue to provide high-quality service even as we develop and deploy new services that our customers require.” He said the added spectrum allocation comes at the right time “and in the right places.”