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Verizon Marches Ahead with Alltel Acquisition Despite Doubts of Analysts

6:10 am on October 7, 2008 | Category: Business, Corporate, Wireless

American cell phone giant, Verizon Wireless, reiterated yesterday that it is moving ahead with its $28.1 billion acquisition of smaller rival, Alltel Corp., despite deterioration in the financial climate since the deal was reached this spring.

The Alltel purchase is on track for completion by the end of this year, according to Verizon spokeswoman, Robin Nichol. But a major financial ratings firm continued to express doubt about the transaction.

“Considering the size of this deal, it would be surprising that Verizon would enter something with such significant risk that it really threatens to preclude this deal from closing,” commented Bill Densmore of New York-based Fitch Ratings, who identified a number of factors that could threaten the Verizon-Alltel deal, in a recent report.

Densmore has suggested that Verizon may not have the financial strength to buy assets that it will later have to resell in order to receive regulatory approval for the acquisition.

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