Investors in US incumbent Verizon Communications and British telco Vodafone Group have overwhelmingly endorsed the US$130bn sale of Vodafone’s 45% stake in US mobile operator Verizon Wireless to Verizon.
Vodafone said that 99.08% of its investors…
Investors in US incumbent Verizon Communications and British telco Vodafone Group have overwhelmingly endorsed the US$130bn sale of Vodafone’s 45% stake in US mobile operator Verizon Wireless to Verizon.
Vodafone said that 99.08% of its investors voted in favour, while Verizon said that 97% of votes cast were for its proposal to issue new Verizon shares in connection with the deal.
The transaction is scheduled to complete on 21 February, and Vodafone shareholders are set to receive Verizon stock and cash on 24 February.
Commenting on the results, Verizon chairman and CEO Lowell McAdam said: “Acquiring Vodafone’s stake in Verizon Wireless will provide Verizon with greater financial flexibility to invest in new technologies and address evolving customer demands.”
Vodafone’s shareholders are set to receive 71% of what the group raises from the sale. In addition to the US$60.2bn in Verizon stock, they will also get US$23.9bn in cash. In a previous statement Vodafone said this equated to a payout of 112p per share.
After doling out US$84bn to shareholders, Vodafone plans to invest US$9.3bn in an organic investment programme to improve its offering to customers over the next three years. It also plans a share consolidation and reduce its debt to 1x EBITDA.
Bernstein Research analysts estimate that after this, Vodafone will only be left with US$11bn to US$15.5bn to bolster its European operations with further acquisitions. Yesterday the British telco was reported to be in discussions with the private equity firms which own Spanish cableco Ono about an acquisition.
