By John Mylant
Verizon Communications (VZ) may have been kicking around the idea of buying Verizon Wireless outright. With the fourth quarter earnings coming around, I would expect it to be a good quarter for Verizon and a purchase may (or may not) have a positive influence on the stock. Let’s explore why.
What would happen if Verizon Bought Out Vodafone?
Rumors have surfaced again (like they did in 2006) that Verizon is seriously exploring a buyout of Verizon Wireless from Vodafone (VOD). If this is true, it constitutes a 45% buyout that Vodafone has in Verizon Wireless. Part of the problem is that the value of the wireless company is well over $100 billion. With that type of purchase, what would be the consequences of this for Verizon investors?
| Verizon CEO says no Verizon Wireless buyout talks with Vodafone |
| By Sinead Carew Reuters News
Wed, 9 Jan 2013 |
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LAS VEGAS, Jan 9 (Reuters) – Verizon Communications is not in talks with Vodafone Group Plc about taking full ownership of their Verizon Wireless venture, despite market speculation this week that such a deal could happen, Verizon’s top executive said. “There’s no discussions about it,” Verizon Chief Executive Lowell McAdam told Reuters late on Tuesday at the Consumer Electronics Show in Las Vegas. Verizon, which owns 55 percent of the wireless venture, has long said that it would be interested in buying out Vodafone if the 45 percent owner would sell its stake. Vodafone shares rose 2.6 percent on Tuesday and added almost 8 points to the FTSE 100 Index, the UK benchmark, after McAdam was quoted in a Dow Jones report saying that a deal could be feasible. But McAdam said his comment did not mean that Verizon was any more likely now to be able to purchase Vodafone’s 45 percent stake in Verizon Wireless than it was before. “Its been feasible for 10 years,” McAdams said. “There’s nothing that’s changed.” |