45% of U.S. carrier Verizon Wireless is owned by British Vodafone. Reuters has previously reported that Verizon hired a firm to help with a buyback of the 45% stake that Vodafone owns for $100 billion. News of this has made way throughout the Vodofone universe and some investors have responded.
Six Vodafone shareholders, who combined own about 1.3 billion shares, have stated they’d like a merger. Other investors have said a full-takeover by Verizon would be preferable. They’re saying this because with a departure of Verizon, Vodafone loses half of its operating profits. When reached for comment, Verizon has stated formally that, “it did not have any intention to merge or make an offer for Vodafone following bid speculation.” Additionally, other investors have stated that a price of $120-135 billion for the 45% stake would be more palatable if a merger or takeover deal isn’t going to happen.
Aside from what actually happens, there’s a whole mess that will happen after a decision is made. There’s lots of red tape and untangling paper trails regarding who owns what. There’s a U.S. holding company called Vodafone America, which is a subsidiary of Vodafone Group Plc. and it’s unclear what they actually own in regards to Verizon. There’s also a question about taxes, because Verizon has proposed a 50/50 cash and stock bid and that could amount to anywhere between $5 billion to $25 billion. Nothing is formal yet, so we shall see…
Via Reuters
