Shares of Verizon (VZ.US) fell sharply at the start of Monday's trading session, dropping nearly 8% to hit a five-month low of $43.07.

The move follows news that the largest U.S. wireless carrier, Verizon, has agreed with BT Group Plc to establish a joint venture for their international operations. The combined annual revenue of this new entity is projected to be approximately $40 billion.

Verizon anticipates the transaction will result in an accounting loss between $700 million and $800 million, but it is expected to enhance the company's core profitability.

In a joint statement released on Monday, the two companies confirmed that, as part of the deal, Verizon has agreed to pay BT a "balancing payment" of $625 million, aligning with prior media reports.

The partners will hold equal voting rights in the joint venture. The completion of the deal remains subject to receiving the necessary regulatory approvals.