WASHINGTON — Verizon Communications Inc. has agreed to buy Herndon, Virginia-based XO Communications’ fiber optic network business for $1.8 billion.

Verizon says it is making the acquisition to improve Internet bandwidth for its business customers and to densify its cell network.

The deal is expected to close in the first half of 2017, pending regulatory approval, Verizon says.

Verizon will lease available XO wireless spectrum, with an option to buy XO’s spectrum business by 2018.

XO Communications’ IP and Ethernet networks are among the largest in the U.S.

XO emerged from bankruptcy in 2003. The chairman and sole shareholder of XO Holdings is billionaire investor Carl Icahn.

“Although this sale does not represent a significant annualized return on our investment, we believe that in today’s environment it does represent the best achievable outcome for the company’s customers, employees and owner,” Icahn said in a statement.