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Verizon may need as much as $130 billion to end Vodafone partnership and control its own destiny

News by Andrew Kameka on Friday April 26, 2013.

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Verizon Communications wants to buyout Vodafone so it can assume full ownership of Verizon Wireless, but the rumored $100 billion the company is seeking to make it happen may not be enough to become sole owner of the carrier.

Following Reuters previous story that Verizon aims to pay $100 billion for Vodafone's 45 percent stake, the Wall Street Journal reports that Vodafone values its ownership stake at $130 billion. The $30 billion gap may be a negotiating tactic to get a higher price, but it's also a sign that Verizon Communications will need to offer more than the $50 billion in cash and $50 billion in stock originally believed to suggested was necessary to buyout Vodafone.

Verizon CFO Fran Shammo has said that his company can make a purchase possible and structure the deal in a way to minimize Vodafone's tax penalty. The Wall Street Journal notes that doesn't mean a deal is in the cards because Verizon is in no rush and similar overtures have been made to buyout Vodafone in the past, but disagreements over price prevented that from happening. This may be the latest in a series of stalled negotiations.

More information on the proposed deal structure is available at The Wall Street Journal.

source: Wall Street Journal (paywall)

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Andrew Kameka
Andrew is based in Miami, Florida.

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