Verizon and Vodafone have reached an agreement on a $130 billion deal that gives Verizon total control of Verizon Wireless, the Wall Street Journal is reporting. Verizon has taken Vodafone’s 45% stake in Verizon Wireless, which was founded as a joint venture between the two companies in 2000.
Verizon and Vodafone’s boards were set to vote on the deal this weekend, which Reuters reported is the third largest corporate acquisition ever and one that removes Vodafone from the US market. The terms of the deal are now waiting on board approval and could be announced as early as Monday afternoon, WSJ reported.
News of this deal goes back to April, when it was reported that Verizon was preparing a $100 billion cash and stock bid. The company, which is the biggest cell phone carrier in the US, already had operational control of Verizon Wireless.
On Saturday, Reuters reported that Verizon planned to pay for the purchase with its own stock and a mixture of bonds and bank loans raised with the help of JPMorgan Chase & Co, Morgan Stanley, Barclays Plc, and Bank of American Merrill Lynch. As to Vodafone, top investors were split on wanting to return the cash and dividends and wanting to invest it.
A potential sale of its Verizon Wireless stake has been on the table for Vodafone since 2004, when the company was considering an exit from the US market leader in order to buy AT&T wireless. Cingular ultimately outbid Vodafone and bought AT&T wireless for $41 billion.
GigaOM’s Om Malik pointed out that Vodafone could make use of that money as it builds its European broadband business. The company acquired Kabel Deutschland for $10.1 billion in May and Cable & Wireless Worldwide for $1.7 billion in April 2012. In early July, Vodafone signed an agreement with Telefonica that gave it access to the Spanish company’s broadband fiber optic network.
Upon its exit from the US, Vodafone maintains a strong presence in Europe, its largest market, Africa, Turkey, and India, among others.
Update: Verizon made the deal official via a press release on Monday. The details of the arrangement were as reported by The Wall Street Journal in its original article.