Vodafone Has Announced it is in Discussions to Sell Off Their Share of Verizon Wireless

This rumor has been swirling around for some time now - Verizon Communications have wanted to buy-back the 45-percent share of Verizon Wireless that Vodafone owns so that Verizon Communications can have total control of their Wireless destiny. Today the Wall Street Journal (WSJ) sent out this "breaking" tweet, which was later confirmed by Vodafone:

Vodafone's response was short and simple:

Vodafone notes the recent press speculation and confirms that it is in discussions with Verizon Communications Inc. regarding the possible disposal of Vodafone's US group whose principal asset is its 45% interest in Verizon Wireless.

There is no certainty that an agreement will be reached.

No certainty indeed in what could be one of the biggest deals in more than a decade, worth somewhere in the neighborhood of $130 billion! Bloomberg reports that sources told them Verizon has approached several banks for $10 billion loans to finance about $60 billion worth of the deal.

The announcement caused Vodafone's stock to jump 9.6-percent to its highest price since 2002 and adding more than $13 billion to its market value. Raiffeisen Capital Management analyst Leopold Salcher said:

This deal is extremely important for Vodafone for their convergence strategy toward more cable assets because pure mobile operators will certainly experience capacity bottlenecks in the future, calling $130 billion a very good price.

Verizon and Vodafone have gone down this path before and could not reach an agreement, although the companies seemed poised to make it happen as both companies could benefit from the divorce. As recently as March, Verizon was willing to pay $100 billion dollars for Vodafone's share, but their investors were looking more in the neighborhood of $120 billion rejected it.

Verizon Communications wants total control of its wireless division, as mobile communications grow, while the landline business continues to shrink. Verizon is investing heavily into its fiber-optic network to sell what customers want - high-speed internet. Verizon Wireless accounted for 66-percent of Verizon's 2012 income, so by growing their wireless division, so will their income, giving them the cash they need to expand as they continue to buy-up spectrum from companies to become the largest U.S. mobile operator.  This time the deal may actually go through and there may be an announcement as early as September 2nd.

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Cory McNutt

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Cory has written for Androidheadlines since 2013 and is a Senior Writer for the site. Cory has a background in Accounting and Finance and worked for the FBI in the past. From there he pursued his Masters in English Literature. Cory loves Android and Google related technology and specializes in Smartphone Comparisons on our site. Contact him at [email protected]
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