Lumen completes sale of Mass Market business to AT&T for $5.75B in cash

Lumen Technologies (LUMN) announced that it has completed the sale of its Mass Markets fiber-to-the-home business in eleven states, including Quantum Fiber, to AT&T (T) for $5.75B in cash. The sale includes substantially all of the related consumer fiber access network and customer relationships in those states, which serves more than 1 million fiber customers and reaches more than 4 million enabled fiber locations. The completed transaction is another strategic milestone in Lumen’s transformation into the leading enterprise digital networking services company built for the multi-cloud, AI-driven economy. Lumen plans to apply approximately $4.8B of the transaction proceeds and cash on hand to retire all super priority debt, reducing the company’s interest expense by approximately $300M annually and accelerating its transformation strategy. The completed transaction is expected to reduce the company’s debt to less than $13B with a net debt to adjusted EBITDA ratio of below 4x. As part of the completed transaction, Lumen will retain assets that will continue to serve as the foundation of its enterprise transformation, including all national, regional, state, and metro level fiber backbone network infrastructure, central offices and associated real estate. In addition, Lumen is retaining and caring for its copper-based consumer services, which continue to provide a strong ongoing financial contribution to Lumen. The enterprise and wholesale fiber customers will remain with Lumen in all geographies. Lumen’s management team will address the completed transaction during the company’s FY25 earnings conference call on February 3.