UK network Vodafone has sent out a statement confirming it’s engaged in talks with Verizon, with a view to selling its 45 percent stake in the company. Published by the BBC, the statement comments on recent speculation, and says discussions are taking place. However, it’s emphasized there’s no guarantee an agreement will be reached.
Neither the buyout talks, or the chance they’ll lead to absolutely nothing, is anything new. A possible Vodafone buyout from Verizon was discussed by CEO Lowell McAdam in an interview at this year’s CES show, “We have always said we would love to own all that asset,” he said, and added that a buyout would be feasible.
Then, in April, it emerged a $100 billion bid had been dangled in front of Vodafone, but it was rejected for being too low. According to an analyst for Jefferies, Vodafone’s share was worth at least $120 billion, making Verizon’s price on the cheeky side. In a Guardian report at the time, an anonymous investor said bids below $135 billion would also be turned down.
This time around, Verizon’s bid is far closer to that figure, with anonymous sources talking to Bloomberg placing it at $130 billion. Should the deal go through, it would close out a nearly 14-year partnership, and end many profitable dividends paid out to Vodafone from Verizon. Interestingly, a by-product of the deal could see Verizon sell back its 23 percent ownership of Vodafone Italia.
Seeing as the two companies have discussed a sale in 2004, 2006, 2007, and 2009 with no resolution, there’s nothing much to say it’ll be any different this time around. However, if the $130 billion bid is correct, it may be the highest Verizon has ever offered, and Vodafone may find it hard to resist. If an announcement is going to be made, it could come as soon as September 2, according to several reports.