Verizon Wireless on Thursday said it will acquire Alltel, the United States fifth largest mobile carrier for a total price of $28.1 billion, which includes $5.9 billion for the equity and $22.2 billion in debt.

Rumors of a possible acquisition involving the two firms have been circulating for a couple of years, but the timing of the deal had everything to do with the current financial climate, experts say.

“The banks and private equity firms and Alltel itself are looking to get rid of debt and they realize they are not going to make money from this thing,” said Shahid Khan, a partner with IBB Consulting Group.

Seven months ago TPG Capital and GS Capital Partners acquired Little Rock, Arkansas-based Alltel in a transaction valued at approximately $27.5 billion.  

The current acquisition, which is subject to regulatory scrutiny, will give Basking Ridge, New Jersey-based Verizon Wireless 13 million more customers in 57 rural markets.

That would vault the #2 mobile carrier into the top spot with more than 80 million customers. AT&T is currently #1 with 71.4 million customers.

“This worked out really well for Verizon since both carriers have CDMA networks and Verizon saves about a billion dollars in roaming costs it currently pays Alltel,” said Mr. Khan.

The timing of the deal may have been influenced to some extent by Verizon Wireless’ recent purchase of licenses to large swaths of 700 MHz spectrum at auction.

The acquisition of the spectrum gave Verizon Wireless the wherewithal to roll out its own network facilities in Alltel’s coverage area, and that would’ve ultimately resulted in the erosion of $1 billion in roaming revenue for Alltel.

“This meant that the value of Alltel was declining, so that certainly could’ve played a part in the investors’ decision to sell to Verizon,” said Joe Nordgaard, director of wireless consulting firm Spectral Advantage.

The acquisition of Alltel gives Verizon Wireless added flexibility, according to Mr. Nordgaard, because the carrier can now wait until LTE, an emerging technology, becomes available before using its 700 MHz spectrum.