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Verizon Vodafone

Vodafone close to $100bn pay day as Verizon meets with banks to buy out its 45% stake

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By Gillian West, Social media manager

August 29, 2013 | 2 min read

American broadband and telecommunications company Verizon is reportedly back in talks with banks discussing the billions of dollars in loans it would need to secure Vodafone’s 45 per cent stake in their joint US venture.

According to reports Verizon is looking to pay around $100bn for Vodafone’s share, with Vodafone holding out for closer to $130bn. Verizon is supposedly working with several banks to raise $10bn from each to finance around $60bn of the deal.

The Wall Street Journal revealed that both companies had restarted talks, but whether or not they had resolved any disagreements over price remains to be seen.

It was in April of this year that news surfaced Verizon had hired advisers for the $100bn buy out, contemplating a 50/50 cash/stock offer for the 45 per cent stake in Verizon owned by Vodafone. At the time, analysts suggested that Verizon’s $100bn bid was too low with Vodafone’s holding worth closer to $120bn.

Gerard Kleisterlee, Vodafone’s chairman, has previously said that the company remains a “happy” and “comfortable” shareholder. And just last month said the company would “seriously consider” an offer if it was of value to investors.

The Wall Street Journal suggests that changes in the financial markets, such as rising interest rates and changes in the US cellphone market have reignited the discussions.

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