Rumors that European mobile giant Vodafone might offer up to $160 billion to acquire Verizon sent Verizon’s stock soaring yesterday. The stock rose four per cent after the Financial times published an article stating that Vodafone had held discussions within the company about a takeover bid, but had yet to make an offer. According to the piece, Vodafone, which already owns 45% of Verizon Wireless, would sell Verizon’s landline business, hoping to reap as much as $90 billion from the sale. The great irony to this is that it was already common knowledge that Verizon hoped to buy Vodafone out of their joint deal. Vodafone dismissed the article, stating, “Vodafone wishes to make it clear that it has no plans to make such an offer.” Any such bid would bring great scrutiny. U.S. regulators don’t look kindly on foreign ownerships of U.S. telecommunications, especially as Verizon provides service to government agencies. Whether a promise to sell of the landline component would be enough remains to be seen. Meanwhile, Vodafone is under internal pressure to get at the value of its Verizon Wireless investment from a group of investors.
