Verizon, Alltel, TPG and Goldman Sachs (VZ, GS, T, VOD)

Alltel may soon be acquired by Verizon Communications Inc. (NYSE: VZ), according to a breaking news report from CNBC‘s David Faber.  Faber just noted that the companies are in advanced talks to acquire the current private equity held Alltel by TPG and GSCP, which are Texas Pacific Group and Goldman Sachs Capital Partners…. part of Goldman Sachs (NYSE: GS).

Alltel went private last year and has somewhere in the vicinity of 13 million wireless subscribers.  The value of that deal was in the $27 to $27.5 billion range, and interestingly enough this new deal may not be at any or at much of a premium to that price.

If there is any company that can acquire this and not have all the credit rating issues and not run into multiple bank debt issues like private equity, then it is Verizon.  There are a couple of other players like AT&T (NYSE: T) or some foreign-owned carriers that could swing it too.

Verizon currently has a market cap after a 1% drop to $36.91 of around $105 Billion.  The one question that would truly come from this is if it would have any impact on the Vodafone (NYSE: VOD) stake in Verizon Wireless that has been a perennial rumor that something will happen there.

You can join our open email distribution list to hear about secondary offerings, mergers, special financings, IPO’s, restructurings, and other special situations.

Jon C. Ogg
June 4, 2008