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Verizon Wireless Spin Off? (IPO)
With a new CEO taking place in Vodafone Group, LLC, Vittoria Colao, as is in most cases of succession a new strategy is arising. Currently Verizon Communications owns 55% of Verizon Wireless, and U.K.-based Vodafone owns the other 45%. Mr. Siedenberg (CEO of Verizon Wireless), his predecessor and past members of the board have expressed disappointment with having to “get permission” from Vodafone on new services, promotions, and other deals. For example, during the bid process of the new spectrum which Verizon Wireless bought a majority of Vodafone had to sign off on most-all bids.
For years, the two companies have contemplated the idea of a buyout or other deal but a price could never be agreed and there has never been a “shake up” of sorts to spark more talks of the matter. As one source says, “they have been handing out future IPO stocks to employees for years because they have always wanted this.” So why now, no one really knows, the best idea: net profit was up only 4.2%. With cost cutting a major area of improvement now for the company a streamlined fully sovereign company makes the most sense.
*We believe a buyout is possible during before the 1st Quarter of 2009, after the credit crunch has subsidized. Use your best judgment.
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