Verizon Wireless to buy Rural Cellular

Verizon Communications posts second-quarter gains

Verizon Wireless today announced plans to buy Rural Cellular Corp. for $757 million in cash to expand Verizon's rural market wireless coverage into Rural's Unicel network in 15 states.

The deal should be approved in the first half of 2008, both companies said, subject to government and stockholder approval.

Verizon Wireless is a joint venture of Verizon Communications Inc., in Basking Ridge, N.J., and Vodafone Group PLC in West Berkshire, U.K.

News of the purchase came on the same day that Verizon Communications announced wireless and wireline earnings of $1.7 billion in the second quarter, up slightly from a year ago, with $23.3 billion in revenues, up 6.3% from the second quarter of 2006.

Verizon Communications said it signed 167,000 new FiOS (Fiber to the Home) TV customers for a total of 515,000, as well as 203,000 new FiOS Internet customers for a total of 1.1 million.

Verizon Wireless customers totaled 60.1 million.

Verizon Wireless said the deal with Rural Cellular, based in Alexandria, Minn., is actually worth $2.67 billion, including the cash payment and assumed debt. The deal could increase Verizon's wireless base by more than 700,000 people.

Last month, AT&T Inc. said it would buy another rural wireless service provider, Dobson Communications Corp., for $2. 8 billion.

Copyright © 2007 IDG Communications, Inc.

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