Verizon Communications today announced plans to sell wireline assets to Frontier Communications for $10.54 billion in cash and also sell and lease cell phone towers for around $5 billion to American Tower. Verizon has reached a definitive agreement to sell its local wireline operations serving customers in California, Florida and Texas to Frontier Communications Corporation. Frontier will pay Verizon approximately $10.54 billion (approximately $9.9 billion in cash, plus $600 million in assumed debt) for the business and related assets in these states.

Verizon will also lease the rights to over 11,300 of its company-owned wireless towers to American Tower Corporation, which will also purchase approximately 165 Verizon towers, for a total upfront payment of approximately $5 billion.

At the same time, Verizon is returning a significant amount of capital to its shareholders through a $5 billion accelerated share-repurchase program entered into today.

Verizon Chairman and CEO Lowell McAdam said: "Our long-standing strategy has been to consistently invest in our networks, improve our customers’ experience, and develop new products and services while delivering profitable growth. These transactions will further strengthen Verizon’s focus on extending our industry leadership position in our core markets and return significant value to our shareholders."

Verizon said that selling wireline operations in California, Florida and Texas to Frontier would concentrate Verizon’s wireline operations on the East Coast. Verizon will focus on further penetrating the market for its FiOS business across a contiguous footprint in Eastern states.

The companies are targeting completing the transaction in the first half of 2016.

Approximately 11,000 Verizon company employees are expected to continue employment with Frontier after the transaction.

The operations Frontier will acquire consist of all of Verizon’s local wireline operating territories in California, Florida and Texas. At the end of fourth-quarter 2014, these operations served approximately 3.7 million voice connections; approximately 2.2 million high-speed data customers, including approximately 1.6 million FiOS Internet customers; and approximately 1.2 million FiOS Video customers.

The transaction includes Verizon’s FiOS Internet and Video customers, switched and special access lines, as well as its high-speed Internet service and long-distance voice accounts in these three states. Frontier will continue to provide video services in these states after the completion of the transaction.

The transaction does not include the services, offerings or assets of other Verizon businesses, such as Verizon Wireless and Verizon Enterprise Solutions.

In the wireless tower transaction, American Tower will have exclusive rights to lease and operate over 11,300 Verizon cell towers, a significant majority of the towers the company currently owns. In addition, Verizon will sell approximately 165 towers outright.

Verizon will have access to additional reserve capacity on the towers for future use and expects to use this additional capacity to help continuously improve the nation’s most reliable network.

Verizon expects the transaction to close by mid-2015, subject to standard closing conditions.

The largest U.S. carrier by subscribers, Verizon purchased 181 licenses worth $10.4 billion in a government sale of wireless airwaves for mobile data that closed last week. That came on top of $130 billion it spent in 2013 to buy from Vodafone the 45 percent in its wireless unit that it did not already own.

The company will use capital raised in these two transactions to invest in upgrading its network.