Verizon considering enterprise disposals - Mobile World Live

Verizon considering enterprise disposals

09 NOV 2015

Verizon is reportedly mulling the sale of assets which could be worth as much as $10 billion, with the spotlight on its assets in the enterprise segment.

In the company’s most recent conference call, Fran Shammo, CFO of the company, noted it was working through “secular and economic challenges” in this market, warning that there is an “awful lot of competition happening with price compression” in some segments.

According to Reuters, Verizon is mulling a sale of the former MCI business, which provides connectivity for large businesses, as well as its Terremark data centre unit.

However, it was also noted that it may not be easy to separate out the activities, and any deal is likely to include a number of commercial service contracts. The operator is still considering how to structure a transaction, the report said.

Earlier talks with fixed line player CenturyLink came to nothing, Reuters continued.

Verizon has undertaken a number of significant deals already in 2015, as both buyer and seller.

It kicked off the year with $15.5 billion worth of disposals, including fixed line assets and towers, having bid heavily in a spectrum auction shortly before.

This was followed by its $4.4 billion acquisition of AOL, which was intended to bolster its video and advertising capabilities.

While the sale of enterprise assets would boost Verizon’s coffers, and reduce its exposure to a market characterised by competition, it would also mean an increased dependence on its core consumer propositions – a market that itself is not without competition.

AT&T is also spending heavily to position itself as a converged service provider, while T-Mobile and Sprint are providing heavy pricing pressure with their value propositions.

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Steve Costello

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