Is Verizon Contemplating an Acquisition?
Shares of Vodafone (NASDAQ:VOD) rose 3 percent on Monday afternoon as Verizon’s (NYSE:VZ) Chief Executive Officer Lowell McAdam hinted at a deal that would leave the United States’ largest wireless service provider the sole owner of Verizon Wireless. Currently, Vodafone holds a 45 percent stake in the wireless partnership that dates back to 2000.
Speaking at a Citigroup investment conference ahead of the Consumer Electronics Show in Las Vegas, McAdam said he believed the company, which owns the remaining 55 percent of the partnership, could to acquire Vodafone’s stake. “We have always said we would love to own all of that asset,” he added, according to The Wall Street Journal.
When the deal was sealed, wireless phone service was relatively new, and the partnership enabled both partners to pool together resources at a time when a great deal of money was needed to build up the operation. However, “it has become awkward now that the business is taking the lead role in growth for the telecom companies,” reported the Journal. The fact that Verizon Wireless distributed a total of $18.5 billion in dividend payouts to its stakeholders last year made the acquisition all the more appealing.
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