(Bloomberg) — Verizon Communications Inc. is interested in buying back a stake in U.S. Cellular Corp.’s Los Angeles operations if the two companies can agree on a reasonable price, Verizon’s consumer chief said.
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U.S. Cellular owns a stake in Verizon's Los Angeles market division, and Verizon has been keen to buy it back for years, Verizon Consumer Chief Executive Officer Soumya Narayan Sampath said in an interview Monday. He said the company would only sign a deal if the price was right. Sampath declined to say what Verizon would consider a fair price, so it's unclear whether an agreement will be reached.
“I would love to buy it back. I'm pretty open about it,” Sampath said. “But it has to be a reasonable price for us.”
A representative for US Cellular declined to comment.
U.S. Cellular's parent company, Telephone and Data Systems Inc., said in a 2016 filing that it holds a 5.5% ownership interest in the Los Angeles SMSA Limited Partnership and subsidiary, with Verizon managing the entity. said. In its annual report filed April 19, TDS said its investment in the Los Angeles partnership contributed $65 million in pre-tax income in both 2023 and 2022.
“Back then, they came in at the right time,” Sampath said.
The Wall Street Journal reported last week that Verizon and T-Mobile US Corp. have acquired U.S. Cellular Corp., a carrier with more than 4 million wireless subscribers in 21 states and a market capitalization of $3.86 billion as of Monday's close. It was reported that the company is in talks to acquire part of the company.
While rivals AT&T and T-Mobile have increased their share of the U.S. wireless retail market in recent years, Verizon's share will decline from 36.5% in 2021 to 2023, according to data compiled by Bloomberg. It dropped to 35.2%. To restore growth, Verizon's SunPass raised prices and offered additional benefits such as bundled Netflix and Max streaming plans.
Verizon's customer losses have eased, but they're not over. The carrier reported a decline in retail mobile wireless subscribers of 158,000 in the first quarter.
(Updates revenue in fifth paragraph.)
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