AT&T has inked a deal with Frontier Communications to net some serious cash.
The wireless carrier on Tuesday announced that it plans to sell its wireline business in Connecticut to Frontier Communications for $2 billion in cash. Frontier offers communications services to residential and commercial customers.
AT&T's decision to sell its Connecticut wireline business reflects a changing focus for the company. Over the last few years, its wireline operation has been deteriorating as traditional phone service has declined and business customers have opted for newer, wireless technologies. AT&T's wireless business, meanwhile, has been growing at a rapid rate, making it a bit more appealing in the company's strategic plan.
That was reflected in comments AT&T made on Tuesday following its announcement of plans to sell the wireline operation. According to the company, it will use the $2 billion from Frontier to invest in its Project VIP initiative -- a rollout of an all-IP, wireless, and cloud network. One of Project VIP's core initiatives is to expand the company's 4G LTE network. AT&T also wants to bring more fiber to business customers.
In addition to getting AT&T's residential and commercial customers, Frontier will take on the 2,700 employees currently supporting that network. The operation is generating $1.2 billion in annual revenue, or less than 1 percent of AT&T's entire annual revenue in 2013.
AT&T's sale is subject to customary closing conditions, including approval by federal regulatory agencies. AT&T hopes to close the deal in the second half of 2014.
This story has been updated throughout the morning.