Alltel Wireless will be far more competitive following the $27 billion buyout by divisions of Goldman Sachs Group Inc. (NYSE: GS) and Texas Pacific Group.
How fast will Alltel be able to scale its customer base and compete with the big four wireless companies? Much faster as a private company if you ask me.
Without quarterly numbers to hit, the company can pour capital into becoming what it has the potential to be and at some future time re-enter the market for the payoffs for GS Capital Partners and TPG Group. Until then, we'll all see what Alltel can do to compete with the larger carriers over time. With this buyout probably having been in the works for most of 2007, you can bet a solid plan is already in place.
With 12 million customers. Alltel is the fifth-largest wireless company behind AT&T Inc. (NYSE: T), Verizon Wireless, Sprint Nextel Corp. (NYSE: S) and T-Mobile USA. It owns wireless liceneses giving it coverage area bigger than the larger four carriers, which is a huge attraction for the private equity firms who already are drawn to the red-hot wireless industry.
The upside is great for this deal since people are dropping land line telephones and moving to the wireless and Internet telephony.
Now it's time to execute.
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