|
|
| |
| Fri, Dec. 5, 2008 |  |
 |
|
||
| |
UPDATE: Ford says LR may become regional center for Verizon Thursday, Jun 5, 2008 By Jason Wiest LITTLE ROCK - Alltel Chief Executive Officer Scott Ford told reporters this afternoon that the buyout of Alltel by Verizon will have very litlle impact on most of the 3,000 employees in Central Arkansas. He says there are only a few hundred people in corporate positions that will be affected. "I'm told the cost center will stay and possibly expand," Ford said. More than 500 people are employed at the call center. "It's not a funeral, it's a transition," Ford said at a planned news conference on the Alltel Campus here. Verizon, with headquarters in New Jersey, has regional headquarters in other parts of the country, and he says it's possible the company will locate a regional headquarters here. He noted that one of the regional offices is in Lewisville, Texas, but said he didn't think that would keep Little Rock from also holding regional status. Ford says he will stay with Alltel through the merger, but will not be part of Verizon once the deal closes. He says he plans to stay in the Little Rock area, however. The vast majority of employees will simply trade in their blue shirts for red ones, Ford said. He says it's a good opportunity for employees who will be joining what will become the nation's largest wireless network. The combined company would leapfrog current industry leader AT&T. Going into the buyout, Verizon is the nation's second largest wireless company; Alltel is fifth. Early today, Verizon announced the agreement to buy Alltel for $28.1 billion in a merger expected to be finalized by the end of the year. Word of the blockbuster deal surfaced in reports Wednesday that Verizon officials and Alltel's private owners were in "deep talks" for the Little Rock-based telecom to be bought for the second time in less than a year. Alltel's previous buyout by private equity firms TPG Capital and GS Capital Partners was final in November. Officials did not immediately address the fate of more than 3,000 personnel at Alltel's local headquarters, though in an e-mail Alltel tried to set employees at ease. "It is not a time for panic, it is a time to seek accurate information and make informed decisions," the e-mail said. "We are committed to getting you the timely information you need to plan." Gov. Mike Beebe released a statement Thursday afternoon welcoming Verizon and urging the company to find a way to absorb Alltel personnel. "In acquiring Alltel, Verizon is obtaining a company with deep Arkansas roots and qualified, dedicated employees," the governor said. "I hope those attributes will resonate strongly as decisions are made about how best to incorporate Alltel into the Verizon family." Attitudes are positive among officials at the Arkansas Economic Development Commission and the Little Rock Regional Chamber of Commerce. "Verizon's a wonderful company," AEDC spokesman Joe Holmes said. "From what we're reading, it's huge, fast growing, and we hope there's a lot of opportunity in this." Holmes said AEDC officials have not spoken with Verizon officials. Little Rock Regional Chamber of Commerce President Jay Chesshir said he was optimistic jobs would be preserved in Arkansas because of the talented employees at Alltel. Verizon will acquire the equity of Alltel for approximately $5.9 billion. Based on Alltel's projected net debt at closing of $22.2 billion, the aggregate value of the transaction is $28.1 billion. Verizon said it expects to "realize synergies with a net present value, after integration costs, of more than $9 billion driven by reduced capital and operating expense savings. Synergies are expected to generate incremental cost savings of $1 billion in the second year after closing." Industry analysts and experts say you don't have to read very far into the statement to see the end of Alltel's corporate presence in Little Rock and many jobs associated with it. "If you're going to save $1 billion, you're going to have to do some cost-cutting, which means unfortunately a number of people in Arkansas are going to have to be moved out of Arkansas or basically let go," said Fariborz Ghadar, director of the Center for Global Business Studies at Penn State University. Ghadar, whose background is in mergers and acquisitions, has served as a consultant for AT&T. The sprawling Alltel campus is one of the largest corporate presences in Little Rock, according to Stuart Mackey, a certified commercial investment member with Coldwell Banker Commercial Hathaway Group. "If Alltel left it would soften the market just due to the volume of space," Mackey said. The highly desirable Riverdale area would quickly shift from a landlord's market to a tenant's market, he said. Acxiom Corp. recently vacated offices in the area. How long the space would sit empty were Verizon to vacate Alltel's campus depends on how the property would be sold, Mackey said. If the campus is sold in one piece, it would take a unique user, he said. "I know that there are some larger corporate groups looking around," he said. "Some would be relocation, some would be new space, and certainly that (the Alltel campus) would be near the top of their list if they could get an appropriate size." |
