Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Vodafone Group Considers 88 Billion Pound U.S. Withdrawal

LONDON -- Following fresh speculation of selling its 45% interest in Verizon Wireless to joint-venture partner Verizon  (NYSE: VZ  ) over the weekend, investors in Vodafone  (LSE: VOD  ) (NASDAQ: VOD  ) saw the value of their shares shoot up over 3%, or 6 pence, to 189.48 pence in early trade this morning -- just 1.5 pence off its five-year high.

Reports in The Sunday Times claimed that Vodafone "is now leaning toward making a clean break from America," which could bank as much as $135 billion, or 88 billion pounds if analysts' valuations of Verizon between $240 billion and $340 billion are correct -- leading to "one of the largest corporate transactions of all time."

A merger had previously thought to have been most likely, but this has been placed in doubt following Verizon shareholders airing their fears over exposure to Vodafone's exposure to troubled Europe.

It is understood that a sale could take place by this summer, with half of the potential profits going toward boosting its European operations and the other half providing a bumper payout for shareholders.

A Fool's-eye view
The hypothesis has caused much comment between investors; on The Motley Fool's Boards, member NK104 commented "why is there any need for VOD to do anything? It can just sit there and bank the dividends from Verizon Wireless, which Verizon needs as much or more than VOD. If Verizon wants anything else, then the ball is in its court."

Elsewhere on the thread, ScillyFool warned Vodafone chief executive Vittorio Colao not to "be railroaded into flogging the 'family silver' cheaply, which the current figure of [88 billion pounds] seems to me to be... Remember, you hold all the aces and someone like China Mobile or even Apple may be interested further down the road."

Vodafone's five-year high came in mid-August last year, when it reached 191 pence -- but looks set to surpass that in the coming days (if not hours!) as investors pile in hoping for that prospective cash windfall.

If you already hold Vodafone shares and you're looking for a stock on a similar yield, then you may wish to read this exclusive free in-depth report. The FTSE 100 company in question offers a 5.7% income, and might be worth 850 pence versus around 735 pence currently. Just click here to download the report -- it's absolutely free.


Read/Post Comments (0) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2330543, ~/Articles/ArticleHandler.aspx, 10/23/2016 2:52:23 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,145.71 -16.64 -0.09%
S&P 500 2,141.16 -0.18 -0.01%
NASD 5,257.40 15.57 0.30%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/21/2016 4:00 PM
VOD $27.77 Down -0.05 -0.18%
Vodafone CAPS Rating: ****
VOD $222.97 Down -0.53 -0.24%
Vodafone CAPS Rating: No stars
VZ $48.20 Down -0.94 -1.91%
Verizon Communicat… CAPS Rating: ****
AAPL $116.60 Down -0.46 -0.39%
Apple CAPS Rating: ****
CHL $58.94 Down -0.28 -0.47%
China Mobile CAPS Rating: ****