Verizon and Vodafone agree on $130B buyout
posted by Michael H. / Sep 01, 2013, 2:06 PM
The actual votes from the boards of each company have not happened yet, but those votes are expected to be little more than a formality at this point. Rather than meeting in the middle, it sounds like Verizon gave in to Vodafone's demands, and will end up paying $130 billion to buyout Vodafone. The talks had originally stalled because Verizon was trying to negotiate the price down closer to $100 billion.
As was said in our report yesterday, the deal is expected to be agreed to by the boards of each company, and the official announcement of the deal should come tomorrow.
Posts: 5993; Member since: Dec 22, 2010
Windfall for Vodafone, but maybe they should declare a liquidating dividend and go out of business? Vodafone's other ops aren't exactly financially compelling.
posted on Sep 01, 2013, 2:09 PM 1
Posts: 179; Member since: Nov 07, 2012
I mean they now have 130B dollars to invest in their other ops.
posted on Sep 01, 2013, 3:55 PM 0
Posts: 17357; Member since: Jun 17, 2009
So Verizon is worth over $260 billion?
posted on Sep 01, 2013, 4:19 PM 0
Posts: 2000; Member since: Apr 16, 2011
You need to do the math: 45% of the WIRELESS business for say $130 billion. 130 billion / 0.45 = about $288.9 billion. The actual value of the entire wireless business is more since minority shareholders get less than full value. Or said differently, had Vodafone tried to buy the Verion Wireless' 55% majority ownership, the entire value would exceed the $290 billion bogey. We know this to be true (e.g. minority shareholders get a discount to fair value) because the average premium is about 30% paid to minority shareholders during corporate takeovers on publicly traded stocks. That is to say, had the minority shares been correctly priced, the 30% premium shouldn't occur. Logic dictates because of the acquistion premium, the existing price prior to the acquistion must reflect the minority discount. The catch is the acquisition price my be less than fair value. Short answer -- the Wireless business is worth say $290 billion since Verizon is acquiring the minority shareholder, BUT SINCE Verizon has other assets (it has landlines, etc), then Verizon is worth way more than $290 billion.
posted on Sep 01, 2013, 6:50 PM 1
Posts: 621; Member since: Jul 31, 2013
1. wtf is Vodafone and 2. holy s**t that's a lot of F****** money
posted on Sep 01, 2013, 6:59 PM 0
Posts: 742; Member since: Dec 05, 2011
I could be wrong, but I believe Vodafone is an old wooden ship that was used during the civil war era......
posted on Sep 01, 2013, 7:32 PM 2
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