Verizon, Vodafone restart talks on $100 billion-plus deal

 

Verizon Communications Inc and Vodafone Group Plc have restarted talks over a possible buyout of the British firm's stake in their US wireless joint venture, the Wall Street Journal said, a deal that is expected to cost Verizon more than $100 billion.

 

Verizon is in discussions with banks about the tens of billions of dollars in loans it would need to complete the deal, the Journal said, citing a person familiar with the matter.

 

But it added that it was not immediately clear whether the two companies had resolved disagreements over price or whether Verizon has put forward a specific offer, the financial daily added.

 

Reuters reported first in April that Verizon had hired advisers for a possible $100 billion bid and was contemplating a roughly 50:50 cash and stock offer for the 45% stake in Verizon Wireless it does not already own.

 

At the time, most analysts said the roughly $100 billion figure contemplated by Verizon was too low and that the value of the Vodafone holding was nearer $120 billion.

 

The Journal said significant shifts in financial markets, such as rising rates as well as changes in the US cellphone business had brought the two sides closer together. Verizon could borrow $50 billion or more to cover the cash component of a deal, the Journal said, citing people familiar with the matter.

 

A Verizon spokesman declined to comment on the report while Vodafone was unavailable for comment outside regular business hours.

 

Vodafone Chairman Gerard Kleisterlee said last month the company would seriously consider any offer for its stake in Verizon Wireless if it offered more value to investors than the current status quo.