US telco Verizon Communications could be considering taking over Vodafone, according to speculation cited by a report in the Daily Telegraph newspaper.
Verizon Communications and Vodafone both declined to comment on the rumours.
Goldman Sachs analysts…
US telco Verizon Communications could be considering taking over Vodafone, according to speculation cited by a report in the Daily Telegraph newspaper.
Verizon Communications and Vodafone both declined to comment on the rumours.
Goldman Sachs analysts in a release said that Vodafone’s stock implied negative long-term growth and traded at a discount to its peers. They placed Vodafone on their ‘Conviction Buy List’.
Robin Bienenstock, an analyst at Bernstein Research, dismissed rumours of a Vodafone takeover by Verizon, suggesting it would be highly unlikely.
“Given the current cash requirements of Verizon we think that the most likely scenario is continued distribution of Verizon Wireless cash to both parent companies, supporting Vodafone’s strong balance sheet and growing, covered, dividends,” Bienenstock said.
US mobile operator Verizon Wireless is a JV between the two companies, with Verizon Communications holding 55% of the carrier and Vodafone controlling the rest.
Verizon Wireless finally made a dividend payment of US$4.5bn to Vodafone in January 2012. The company had suspended making dividends in 2005 in order to pay down debt. Vodafone held on to its stake in the company, despite speculation that it would sell.
