The Transactions

6 Months Ended

Jun. 30, 2014

The Transactions [Abstract]

The Transactions

(3)   The Transactions:

The 2010 Transaction

On July 1, 2010, the Company acquired the defined assets and liabilities of the local exchange business and related landline activities of Verizon Communications Inc. (Verizon) in 14 states (the Acquired Territories), including Internet access, long distance services and broadband video provided to designated customers in the Acquired Territories (the 2010 Acquired Business). Frontier was considered the acquirer of the 2010 Acquired Business for accounting purposes. All integration activities for the 2010 Transaction were completed as of the end of 2012.

The AT&T Transaction

On December 17, 2013, the Company announced that it entered into an agreement to acquire the wireline properties of AT&T Inc. (AT&T) in Connecticut (the AT&T Transaction) for a purchase price of $2.0 billion in cash, with adjustments for working capital. Upon completion of the AT&T Transaction, Frontier will operate AT&T’s wireline business and fiber optic network that provides services to residential, commercial and wholesale customers in Connecticut. The Company will also acquire AT&T’s U-verse® video and satellite TV customers in Connecticut. 

The Company will account for the AT&T Transaction in accordance withthe guidance included in U.S. GAAP for business combinations.  We incurred $19.9 millionand $30.4 millionof acquisition and integration related costs in connection with the AT&T Transaction during the three and six months ended June 30, 2014, respectively.  

On July 25, 2014, the Federal Communications Commission (FCC) approved the AT&T Transaction. The Company is currently also seeking approval from the Connecticut Public Utilities Regulatory Authority, and has already received Justice Department approval.