Vodafone Nears $130bn Verizon Windfall
Vodafone may confirm late on Monday that it is selling its stake in America's biggest mobile phone company in a $130bn (£84bn) deal which could boost the UK economy.
The FTSE 100 mobile phone firm confirmed the value it was seeking for its stake in Verizon Wireless - its joint US venture with Verizon Communications - in a new statement on Sunday.
Itt said that talks were at an advanced stage and it is understood that the cash and shares agreement now only needs the approval of the Verizon Communications board.
If an agreement is reached, Verizon would own its wireless business outright after buying Vodafone's 45% interest.
Vodafone said there was no certainty that a final deal would be reached, but such a windfall would allow the company to plot further expansion and return cash to shareholders in what could prove to be a major boost for the UK economy.
There is speculation Vodafone would plan to issue a special dividend which could yield investors up to £40bn in total - cash that might find its way back into the economy, partly through tax.
However, there is also the possibility of controversy over the way the deal is arranged amid reports that Vodafone's tax liabilities will be minimised by completing the transaction through its Luxembourg subsidiaries and other offshore companies.
The buyout, if finalised, would be one of the biggest corporate deals in history - behind Vodafone's $172bn acquisition of Mannesmann in 2000, according to research firm Dealogic.
Verizon has had a long-standing interest in buying out its partner, but the two companies never managed to agree on a price.
Analysts said Verizon wanted to pay around $100bn for Vodafone's stake, while Vodafone had been pressing for the higher sum.
Vodafone shares, which rose sharply last week, rose 4% in early trading on Monday before extending those gains past 12% in the afternoon.