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Verizon is Buying Frontier in $20B Deal to Strengthen its Fiber Network

This April 23, 2018, file photo shows the logo for Verizon above a trading post on the floor of the New York Stock Exchange. Verizon's decision to join the growing boycott against Facebook and Twitter risks hurting the social media giants where it hurts most: their advertising revenue. Advertising accounts for nearly all Facebook's $70.7 billion annual revenue, and a similar share of Twitter's $3.46 billion. (AP Photo/Richard Drew, File)
This April 23, 2018, file photo shows the logo for Verizon above a trading post on the floor of the New York Stock Exchange. Verizon's decision to join the growing boycott against Facebook and Twitter risks hurting the social media giants where it hurts most: their advertising revenue. Advertising accounts for nearly all Facebook's $70.7 billion annual revenue, and a similar share of Twitter's $3.46 billion. (AP Photo/Richard Drew, File)
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Verizon is Buying Frontier in $20B Deal to Strengthen its Fiber Network

This April 23, 2018, file photo shows the logo for Verizon above a trading post on the floor of the New York Stock Exchange. Verizon's decision to join the growing boycott against Facebook and Twitter risks hurting the social media giants where it hurts most: their advertising revenue. Advertising accounts for nearly all Facebook's $70.7 billion annual revenue, and a similar share of Twitter's $3.46 billion. (AP Photo/Richard Drew, File)
This April 23, 2018, file photo shows the logo for Verizon above a trading post on the floor of the New York Stock Exchange. Verizon's decision to join the growing boycott against Facebook and Twitter risks hurting the social media giants where it hurts most: their advertising revenue. Advertising accounts for nearly all Facebook's $70.7 billion annual revenue, and a similar share of Twitter's $3.46 billion. (AP Photo/Richard Drew, File)

Verizon is buying Frontier Communications in a $20 billion deal to strengthen its fiber network.

Verizon Communications Inc. said Thursday that the acquisition will also shore up its foray into artificial intelligence as well as connected smart devices.

Frontier has concentrated heavily on its fiber network capabilities over about four years, investing $4.1 billion upgrading and expanding its fiber network. It now gets more than half of its revenue from fiber products.

The price tag for Frontier, based in Dallas, is sizeable given its 2.2 million fiber subscribers across 25 states. Verizon has approximately 7.4 million Fios connections in nine states and Washington, D.C, The AP reported.

Frontier has 7.2 million fiber locations and has plans to build out an additional 2.8 million fiber locations by the end of 2026.

“The acquisition of Frontier is a strategic fit," Verizon Chairman and CEO Hans Vestberg said in a prepared statement. "It will build on Verizon’s two decades of leadership at the forefront of fiber and is an opportunity to become more competitive in more markets throughout the United States, enhancing our ability to deliver premium offerings to millions more customers across a combined fiber network.”

Verizon, based in New York City, will pay $38.50 for each Frontier share. The deal is expected to close in about 18 months. It still needs approval from Frontier shareholders.

Shares of Frontier Communications Parents Inc., which were halted briefly on Wednesday after a report from the Wall Street Journal about the deal sent the stock up nearly 40%, fell 9% before the market opened on Thursday. Verizon's stock rose slightly.

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Volkswagen Workers to Go on Warning Strikes Across Germany

The Volkswagen logo is displayed on the Volkswagen power plant on the day when Volkswagen AG and the industrial union IG Metall started talks over a new labor agreement for six of its German plants, in Wolfsburg, Germany, September 25, 2024. REUTERS/Annegret Hilse/File Photo
The Volkswagen logo is displayed on the Volkswagen power plant on the day when Volkswagen AG and the industrial union IG Metall started talks over a new labor agreement for six of its German plants, in Wolfsburg, Germany, September 25, 2024. REUTERS/Annegret Hilse/File Photo
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Volkswagen Workers to Go on Warning Strikes Across Germany

The Volkswagen logo is displayed on the Volkswagen power plant on the day when Volkswagen AG and the industrial union IG Metall started talks over a new labor agreement for six of its German plants, in Wolfsburg, Germany, September 25, 2024. REUTERS/Annegret Hilse/File Photo
The Volkswagen logo is displayed on the Volkswagen power plant on the day when Volkswagen AG and the industrial union IG Metall started talks over a new labor agreement for six of its German plants, in Wolfsburg, Germany, September 25, 2024. REUTERS/Annegret Hilse/File Photo

Volkswagen workers will go on warning strikes on Monday at plants across Germany, labor union IG Metall said, marking the first large-scale walkouts at Volkswagen's domestic operations since 2018.

The start of the strikes represents a further escalation of a dispute between Europe's top carmaker and its workers over mass layoffs, pay cuts and possible plant closures - drastic measures the company says it cannot rule out in the face of Chinese competition and cooling consumer demand.

Labor representatives at VW had on Nov. 22 voted for limited strikes at German operations from early December after talks over wages and plant closures failed to achieve a breakthrough, Reuters reported.

"If necessary, this will be the toughest collective bargaining battle Volkswagen has ever seen," IG Metall negotiator Thorsten Groeger said in a statement.

The carmaker said it continues to rely on constructive dialogue to find a sustainable solution.

"Volkswagen respects the right of employees to take part in a warning strike," a spokesperson said in reply to the union's announcement, adding that the company had taken steps in advance to ensure a basic level of supplies to customers and minimise the impact of the strike.

Warning strikes in Germany usually last from a few hours.

The union had last week proposed measures it said would save 1.5 billion euros ($1.6 billion), including forgoing bonuses for 2025 and 2026, which Europe's top carmaker dismissed.

Volkswagen has demanded a 10% wage cut, arguing it needs to slash costs and boost profit to defend market share in the face of cheap competition from China and a drop in European car demand.

The company is threatening to close plants in Germany for the first time in its 87-year history.

"Volkswagen has set fire to our collective agreements and instead of extinguishing this fire in three collective bargaining sessions, the management board is throwing open barrels of petrol into it," Groeger said.

An agreement not to stage walkouts had ended on Saturday, IG Metall said, enabling workers to carry out warning strikes from Sunday across VW AG's German plants.

"Warning strikes will start at all plants from Monday. How long and how intensive this confrontation needs to be is Volkswagen's responsibility at the negotiating table," Groeger said.

Labor representatives and management will meet again on Dec. 9 to carry on negotiations over a new labor agreement for workers at the German business - VW AG - with unions vowing to resist any proposals that do not provide a long-term plan for every VW plant.