It may be Labour Day, but it doesn’t stop the tech news from hitting the Internet. The big news today is that Verizon has bought out the stake that Vodofone had in it for $130 billion:
The complex cash-and-stock deal includes a $58.9 billion cash component, as well as a further $60.2 billion in Verizon shares. The American company also will hand Vodafone its current 23 per cent holding in Vodafone Italy for $3.5 billion, as part of a series of smaller transactions connected to the deal.
Here’s why Vodafone would do this deal:
The deal does give Vodafone a huge war chest, and could have a big effect on the European telecommunications industry, which has been faced with lackluster earnings and increased international competition — even as regulators push for carriers to invest in new, high-speed data networks that would put consumers and business customers on a more equal digital footing with data users in the United States and the most advanced parts of Asia, like South Korea.
As for Verizon, the reason for them to do this deal is that they would not have to share the revenue from the US marketplace. Over time, that could become very profitable.
Now, the only outstanding item is this. Does this deal mean that Verizon’s entry into the Canadian marketplace is off the table? That’s still up in the air. We’ll find out on the 17th of September when the deposits for the spectrum auction. My feeling. They’ve just dropped $130 billion. What’s another few billion?
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This entry was posted on September 2, 2013 at 5:43 pm and is filed under Commentary with tags verizon, Vodafone. You can follow any responses to this entry through the RSS 2.0 feed.
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Verizon Approves Buyout Of Vodafone Share
It may be Labour Day, but it doesn’t stop the tech news from hitting the Internet. The big news today is that Verizon has bought out the stake that Vodofone had in it for $130 billion:
The complex cash-and-stock deal includes a $58.9 billion cash component, as well as a further $60.2 billion in Verizon shares. The American company also will hand Vodafone its current 23 per cent holding in Vodafone Italy for $3.5 billion, as part of a series of smaller transactions connected to the deal.
Here’s why Vodafone would do this deal:
The deal does give Vodafone a huge war chest, and could have a big effect on the European telecommunications industry, which has been faced with lackluster earnings and increased international competition — even as regulators push for carriers to invest in new, high-speed data networks that would put consumers and business customers on a more equal digital footing with data users in the United States and the most advanced parts of Asia, like South Korea.
As for Verizon, the reason for them to do this deal is that they would not have to share the revenue from the US marketplace. Over time, that could become very profitable.
Now, the only outstanding item is this. Does this deal mean that Verizon’s entry into the Canadian marketplace is off the table? That’s still up in the air. We’ll find out on the 17th of September when the deposits for the spectrum auction. My feeling. They’ve just dropped $130 billion. What’s another few billion?
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This entry was posted on September 2, 2013 at 5:43 pm and is filed under Commentary with tags verizon, Vodafone. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.