April 25 - Vodafone shares are boosted by reports Verizon Communications is preparing to take full control of Verizon Wireless from its British venture partner Vodafone. Kirsty Basset reports.
Vodafone shares rose 1.5 per cent in early trade on Thursday - after two sources told Reuters that Verizon Communications was working on a $100 billion bid to buy out Vodafone's stake in Verizon Wireless. Verizon, the United States' number one wireless carrier - has made little secret of its wish to buy out its British partner, and is reportedly considering a 50:50 cash and stock bid for the 45 per cent stake it doesn't already own. Reuters' Breaking Views editor Robert Cole. (SOUNDBITE)(English) REUTERS BREAKING VIEWS EDITOR ROBERT COLE SAYING: "The pressure is building here very substantially. The jungle drums have been beating for some years and the intensity of that noise has increased notably in recent weeks." Verizon hasn't put forward a proposal but has reportedly hired both banking and legal advisors for a possible bid. Vodafone shares have risen 26 per cent this year on speculation that it could be ready to sell its stake. Verizon is hoping to start discussions with Vodafone soon, but sources say there are no guarantees a deal will happen. Both Vodafone and Verizon declined to comment on the reports. (SOUNDBITE)(English) BREAKING VIEWS EDITOR ROBERT COLE SAYING: "I do think Vodafone is getting towards the position where the story is running away from itself and that it needs for its shareholders to make its position clear. Whether that means making a statement is tricky because that sort of puts itself in play if you like but I think it somehow has to put itself on the front foot here." Vodafone investors and analysts say $100 billion is too low for the stake, with one analyst saying a potential sale could be closer to $125-130 billion.