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Vodafone rejects Verizon's $100bn buyout offer Vodafone rejects Verizon's $100bn buyout offer
(5 months later)
The $100bn (£66bn) that Verizon is reportedly willing to spend on buying out Vodafone from the two companies' joint venture US mobile network has been dismissed as "nowhere close" to the amount demanded by shareholders.The $100bn (£66bn) that Verizon is reportedly willing to spend on buying out Vodafone from the two companies' joint venture US mobile network has been dismissed as "nowhere close" to the amount demanded by shareholders.
US cable business Verizon Communications is considering a half cash, half shares offer for Vodafone's 45% stake in Verizon Wireless, America's biggest mobile operator, according to Reuters. The US firm has reportedly hired legal and banking advisers to lead the deal.US cable business Verizon Communications is considering a half cash, half shares offer for Vodafone's 45% stake in Verizon Wireless, America's biggest mobile operator, according to Reuters. The US firm has reportedly hired legal and banking advisers to lead the deal.
"Valuation will need to climb much higher to create an outcome acceptable to Vodafone shareholders," Jefferies bank analyst Jerry Dellis said, who values the stake at $120bn. "Our sense is that Verizon is attempting to up pressure on Vodafone to engage in discussions. The glaring issue is price – $100bn is nowhere close to the level at which Vodafone can consider a deal.""Valuation will need to climb much higher to create an outcome acceptable to Vodafone shareholders," Jefferies bank analyst Jerry Dellis said, who values the stake at $120bn. "Our sense is that Verizon is attempting to up pressure on Vodafone to engage in discussions. The glaring issue is price – $100bn is nowhere close to the level at which Vodafone can consider a deal."
One anonymous top-40 Vodafone investor said there was "absolutely no way" shareholders would accept the mooted price, but that $135bn would suffice.One anonymous top-40 Vodafone investor said there was "absolutely no way" shareholders would accept the mooted price, but that $135bn would suffice.
Australian hedge fund boss John Hempton, whose Bronte Capital is heavily invested in Vodafone, said the price being discussed was "not enough", and that the proceeds of any deal should be handed directly to investors.Australian hedge fund boss John Hempton, whose Bronte Capital is heavily invested in Vodafone, said the price being discussed was "not enough", and that the proceeds of any deal should be handed directly to investors.
Verizon Communications has been increasingly vocal in its attempts to get its British partner to the negotiating table, saying publicly last week that the capital gains tax bill which is understood to be discouraging Vodafone from selling could be minimal.Verizon Communications has been increasingly vocal in its attempts to get its British partner to the negotiating table, saying publicly last week that the capital gains tax bill which is understood to be discouraging Vodafone from selling could be minimal.
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