The shareholders of both Verizon Communications and Vodafone Group have approved the sale of Vodafone's stake in +Verizon Wireless to Verizon Communications. Verizon Wireless is a joint venture between Verizon Communications and +Vodafone. Vodafone owns about 45% of Verizon Wireless. Verizon Communications proposed last year to take full ownership of the joint venture in a deal valued at $130 billion. The companies' shareholders agreed to the terms of the sale and the issuance of new stock to make the financial transaction work. The Federal Communications Commission has already approved the sale, but it still needs the approval of the High Court of Justice of England and Wales. The companies expect the deal to close on or about February 21.
Verizon Communications announced that it has agreed to buy the 45% of Verizon Wireless that it does not already own from Vodafone Group for $130 billion. Verizon will pay Vodafone primarily in cash and stocks. The deal was agreed upon by the management teams over the weekend and approved by the boards of directors at both firms today. Lowell McAdam, Verizon chairman and CEO, said, "This transaction will enhance value across platforms and allow Verizon to operate more efficiently, so we can continue to focus on producing more seamless and integrated products and solutions for our customers. We believe full ownership will provide increased opportunities in the enterprise and consumer wireline markets." Once complete, Verizon will have full control over Verizon Wireless and its assets. Vodafone will use the funds gained through the divestiture to fortify its European and other worldwide business ventures. The deal will be subject to regulatory and shareholder approval and is expected to close in the first quarter of 2014.
Source: Verizon Wireless
Vodafone today confirmed reports that it is in talks with Verizon Communications to sell its 45% stake of Verizon Wireless. Verizon Wireless is a joint venture between Verizon Communications and Vodafone. The companies held talks earlier this year, but no deal was reached. The two firms rekindled their discussions in July due to changes in the financial markets that make the deal more attractive to both companies. Verizon is working with banks to raise about $60 billion to help with the buyout. The total cost of the deal is said to between $100 and $130 billion. Vodafone said that it would use any funds raised by the sale to help with other acquisitions and to pay down debt.
Source: Reuters
Vodafone owns a 45% stake in Verizon Wireless. This is a fact that rankles Verizon constantly. Verizon has tried a number of times to work out a deal to buy out Vodafone, but it hasn't been able to make the deal yet. According to the Wall Street Journal, Verizon and Vodafone have started up talks again to try to arrange a buyout.
The talks between the two sides had said to have fallen off recently, but apparently have gotten very serious. The report says that Verizon is looking to buy out Vodafone for "well over $100 billion"; word has it that the talks have gotten serious enough that Verizon has even been talking to multiple banks about the loans for around $50 billion it would need in order to complete the deal.
Earlier this year, the two sides were quite far apart with Verizon said to be pushing for a deal closer to $100 billion, while Vodafone was asking for something around $130 billion.
Source: WSJ
