Several mergers in recent years have led to an increasingly concentrated wireless industry in the U.S., with the bulk of control under Verizon, AT&T and T-Mobile, which recently completed its merger with Sprint. Tracfone is the largest prepaid mobile brand in the United States, with approximately 21 million subscribers and more than 90,000 retail locations, which means Verizon will boost its subscriber base considerably. It also plans to sell 5G to Tracfone customers in the coming years as carriers compete to roll out the faster networks.
Pending regulatory approvals, the acquisition is expected to close in the second half of 2021.
The deal is for $3.125 billion in cash and $3.125 billion in Verizon common stock and an additional $650 million in future cash consideration related to the achievement of certain performance measures. Verizon shares were up more than 1% in Monday afternoon trading.
Reuters contributed to this report.