TracFone

History

2020: Verizon purchased TracFone for $7 billion

On September 14, 2020 Verizon Communications announced TracFone acquisition. The transaction worth about $7 billion will be paid with own means and actions of the buyer (for $3.125 billion). Besides, Verizon can pay $650 million more in case of achievement of certain results of TracFone. About what tasks there is a speech, it is not specified.

The TracFone company which is sold by the Mexican telecommunication giant América Móvil SAB by the time of the conclusion of the transaction with Verizon totals about 21 million subscribers in the USA. The operator renders services both under the brand of the same name, and under the StraightTalk, Net10, SafeLink and Simple Mobile brands. TracFone has no own telecommunication infrastructure — the operator uses networks of other operators (such model of business is called MVNO).

Verizon purchased virtual operator TracFone for $7 billion

Due to merger of TracFone the Verizon company expects business in the American mobile communications market, providing access for clients of Tracfone to LTE 4G network and a 5G and other innovative technologies and also to continue development of distribution channels of the company.

The transaction is continuation of strategy of Verizon focused on service of the American consumers. The portfolio of the Tracfone brands creates the platform for growth of the company and development of innovations of Verizon, it is specified in the press release.

It is noted that subscribers of Tracfone will remain in plus from the transaction as, in particular, still services of a 5G were unavailable to them, and now they will get access to them, as well as to convergent services, including the fixed house broadband access. For them conditions of the international calls and the international roaming will improve.

According to The Wall Street Journal, sale of TracFone of Verizon company continues consolidation of the American telecom industry which continues several years.^[1]

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