Verizon Wireless Receives $1.5 Billion of Company's Deposit From the Federal Communications Commission
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BEDMINSTER, N.J. - Verizon Wireless announced today that the Federal Communications Commission (FCC) has returned $1.5 billion of the deposit that the company provided in connection with the February 2001 auction of 216 wireless licenses, including the so-called NextWave licenses.
Verizon Communications Inc. (NYSE:VZ), which owns 55 percent of Verizon Wireless, plans to use the $1.5 billion to reduce commercial paper and overall debt levels. In announcing quarterly earnings last week, Verizon Communications noted that during the first quarter of 2002 the company had reduced overall debt by $1.4 billion, to $62.9 billion from $64.3 billion at year-end 2001. Verizon also reduced commercial paper by $2.2 billion in the quarter, to $10.6 billion from $12.8 billion.
"The return of $1.5 billion of our deposit is a good start," said Denny Strigl, Verizon Wireless president and CEO. "This deposit was handed over in good faith to the FCC more than a year ago and its return, along with the remainder of the deposit that the FCC continues to hold, is long overdue. The auction is clearly void or voidable, and we believe a return of the entire deposit and cancellation of our obligations are required."
Verizon Wireless bid $8.7 billion for 67 licenses and made the required $1.7 billion deposit with the government. The FCC did not deliver the licenses, however, after a federal court held that the licenses were owned by NextWave and were not the government's to auction. The FCC has said it would hold on to the remainder of Verizon's deposit in order to preserve the results of Auction 35 pending action on the case now before the U.S. Supreme Court.
In April, Verizon Wireless filed suit against the FCC in the U.S. Court of Appeals for the District of Columbia Circuit and in the U.S. Court of Federal Claims, seeking a declaration that the auction is void and a return of the entire deposit.
Verizon Wireless is the nation's leading provider of wireless communications and Internet services. The company has the largest nationwide wireless network and 29 million customers. Headquartered in Bedminster, N.J., Verizon Wireless is a joint venture of Verizon Communications (NYSE:VZ) and Vodafone (NYSE and LSE: VOD). Reporters and editors can find more information on the Web at http://www.verizonwireless.com.
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