Verizon agrees to pay $20 billion in cash for Frontier Communications. Frontier is largest pure fiber telecom in the US, deal will extend Fios offering to 25 more states. VZ stock sank more than 3% on Wednesday and continues to trade lower on Thursday. Dow Jones is trading nearly one percentage point lower on Thursday, performing worse than S&P 500, NASDAQ. Verizon shareholders have not taken kindly to the announcement that the telecom will be acquiring Frontier Communications .
In a statement Verizon said that upon closing the acquisition would immediately be “accretive to revenue and Adjusted EBITDA growth” but by year three would account for $500 million in annual run-rate cost synergies. Frontier Communications fiber offerings extend to 25 additional states Frontier is the largest “pure-play fiber internet provider”, according to Verizon, which said it will integrate Frontier’s 7.