For many years now, Vodafone and Verizon have jointly owned Vodafone Wireless. Vodafone holds nearly 45% stake in the company whereas the rest of the control is in the hands of Verizon. Reports have it that the two companies have reached a deal according to which, Vodafone may sell its stake to Verizon for a whopping $130 billion.
Vodafone purchased its stake in Verizon Wireless some 14 years ago for $70 billion. Since then, Verizon and Vodafone have held the joint ownership of the largest wireless company in U.S. However, the two companies have had their differences and Vodafone has long been resentful of its return on the investment.
Now, it would appear that the duo are about to reach a deal which may be acceptable to both. Vodafone gets to have $130 billion in cash and stock whereas Verizon gets to bag the complete ownership of Verizon Wireless.
The initial agreement has been reached between the two, although the deal will not be finalized until the boards of both companies give a green signal. If all goes well and no disagreements ensue in the meantime, it is expected that the deal will be finalized within the next two days.
Verizon Wireless has a huge subscriber base in the U.S. and has been growing at a rapid pace, bringing in huge profits. Now that Verizon is about to gain the complete control of the company, it is all set to bag the ever-growing profits of the wireless company.
Source: WSJ
Courtesy: The Verge
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