Vodafone finally gets dividend from Verizon
Shares in Vodafone, the world's biggest mobile phone operator by revenue, rose as much as 5.7 per cent yesterday before closing 4 per cent, or 6.6p, higher at 172p after Verizon Wireless said it would pay $10bn to the British company and co-owner Verizon Communications.
"Verizon's attempt to squeeze Vodafone has resoundingly failed, they now have no choice but to pay," Robin Bienenstock at brokerage Bernstein said, predicting regular dividends.
Vodafone has not received a payout from Verizon Wireless, in which it holds a 45 per cent stake, since 2005, partly because Verizon had hoped to force Vodafone out of the joint venture by not paying a dividend, say analysts.
The development is the latest victory in a campaign by chief executive Vittorio Colao to make Vodafone's sprawling portfolio more effective.
In the last year, Vodafone has resolved several shared-ownership issues, including buying Essar out of an Indian joint venture for $5.46bn and selling a stake in China Mobile for $6.5bn.
Vodafone said its shareholders would receive 2bn from its share of the windfall via a special 4p-per-share dividend to be paid in February, with the balance used to pay down debt.