Summary
Verizon Communications Inc. has filed an 8-K report detailing the closing of its acquisition of TracFone Wireless, Inc. This significant transaction, announced in September 2020, was completed on November 23, 2021. As part of the acquisition, Verizon issued 57,596,544 shares of its common stock to AMX USA Holding, S.A. de C.V. This issuance was made without registration under the Securities Act of 1933, relying on the private offering exemption due to AMX USA's accredited investor status. Verizon also entered into a registration rights agreement with AMX USA, committing to file an automatic shelf registration statement to allow for the resale of these newly issued shares. The total consideration for TracFone includes $3.125 billion in cash (subject to adjustments), the aforementioned shares, and potential future cash payments up to $650 million tied to performance and commercial arrangements. This acquisition is expected to have strategic implications for Verizon's market position in the prepaid segment.
Key Highlights
- 1Verizon successfully closed the acquisition of TracFone Wireless, Inc. on November 23, 2021.
- 2As partial consideration for the acquisition, Verizon issued 57,596,544 shares of its common stock to AMX USA Holding, S.A. de C.V.
- 3The issuance of these shares was conducted under a private placement exemption (Section 4(a)(2) of the Securities Act) to an accredited investor.
- 4Verizon has agreed to file a shelf registration statement to permit the resale of these 57.6 million shares by AMX USA.
- 5The total purchase price for TracFone includes $3.125 billion in cash (subject to adjustments).
- 6Additional future cash consideration of up to $650 million may be paid based on performance and commercial arrangements.
- 7The acquisition marks a significant strategic move for Verizon in the prepaid wireless market.