AT&T and Verizon exchanging assets

Verizon Wireless has been forced to sell service territories spanning across 18 states in compliance with regulatory conditions of its acquisition of Alltel. The 79 areas are mostly rural Alltel territories which overlap with Verizon’s own coverage. Other areas put up for sale which are unassociated with Alltel include some of Verizon’s own, and areas covered by Rural Cellular, another carrier purchased by Verizon last year. AT&T was the expected high bidder, who will pay $2.35 billion for the assets.

Also, AT&T has agreed to sell five Centennial Communications service areas that will overlap its network to Verizon for $240 million, upon the pending regulatory approval. All in all, AT&T will walk away with spectrum licenses, cell towers and 1.5 million subscribers – all of which will need to obtain new mobile devices to access AT&T’s network.

The Dallas-based telecommunications behemoth is expecting the deal to close in the fourth quarter, after which it will spend $400 million and several months converting the areas.