Verizon announced on Thursday (5th) that it will acquire Frontier Communications in a $20 billion deal, as the US wireless carrier aims to strengthen its fiber optic network business.

Frontier Communications' stock price fell more than 10% in pre-market trading on Thursday. Verizon has increased by approximately 1%.

Verizon offered $38.50 per share of Frontier stock, a premium of 37.3% over Frontier's closing price before the potential acquisition report appeared on September 3.

The transaction is expected to generate at least $500 million in annual operating cost synergies.