facebook
twitter
rss
account
search
search
 

Verizon poised to pay $130 billion to control its cell business

Sept. 2, 2013 at 3:30 AM   |   Comments

BASKING RIDGE, N.J., Sept. 2 (UPI) -- Verizon is likely to announce a $130 billion deal Monday to buy Vodafone's 45 percent stake in its U.S. cellphone business, people who know the details said.

The cash-and-stock deal giving Verizon Communications Inc. full control over Verizon Wireless is expected to have little effect on Verizon's nearly 100 million cellphone customers, observers said.

But it will provide a bonanza for Wall Street, with fees reaching up to $500 million, a person familiar with the matter told The Wall Street Journal.

The deal -- which would be the third-biggest takeover in corporate history -- could be announced Monday afternoon, after the Verizon board votes on it, the people familiar with the matter told the Journal, The New York Times and the Financial Times.

The board was expected to meet Monday morning.

The Vodafone Group PLC board was believed to have approved the deal Sunday night.

Neither company would comment on the possible announcement. But Vodafone, based in Newbury, England, confirmed the $130 billion price late Sunday.

Vodafone also said there was no certainty a deal would be reached.

If the deal goes through, Verizon would pay roughly $60 billion in cash and $70 billion in stock for Vodafone's stake, a person told the Journal.

The $60 billion would be the largest amount of cash ever brought to an acquisition, topping the more than $50 billion Belgium's InBev paid to buy the Anheuser-Busch brewing giant in 2008, said Dealogic, which provides investment-bank management support.

Verizon Wireless of Basking Ridge, N.J., is the biggest U.S. cellphone service operator, claiming nearly 99 million subscribers, compared with AT&T Mobility's roughly 78 million.

Vodafone, the world's second-largest cellphone company, would suddenly be flush with cash. It is expected to return several billion of it to shareholders, the Financial Times said.

Vodafone may also pursue other telecommunications companies in Europe, the Journal said. But it could also become an acquisition target itself, with AT&T Inc. a possible suitor, the Journal added.

AT&T Chief Executive Officer Randall Stephenson has told investors he's interested in pursuing European carriers that would give the company access to markets across the continent, the newspaper said.

The Verizon-Vodafone joint venture is a remnant of a 1999 joint venture between Vodafone and Bell Atlantic, a Verizon predecessor, to establish a U.S. cellphone service provider.

© 2013 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
Recommended UPI Stories
Featured UPI Collection
trending
2014: The Year in Music [PHOTOS]

2014: The Year in Music [PHOTOS]

Most Popular
1
Rheinmetall, KBR in joint venture bid for British defense entity
2
Starbucks testing smaller Frappuccinos Starbucks testing smaller Frappuccinos
3
Anheuser-Busch not satisfied with the way NFL has handled recent incidents Anheuser-Busch not satisfied with the way NFL has handled recent incidents
4
First MT30 engine for Korean Navy frigates passes acceptance tests First MT30 engine for Korean Navy frigates passes acceptance tests
5
New National Security Cutter delivered to Coast Guard New National Security Cutter delivered to Coast Guard
Trending News
Video
x
Feedback