* Verizon to buy Vodafone's 45 pct of Verizon Wireless
* Ends decade-long stand-off between Verizon and Vodafone
* Will be third-largest deal of all time
* Vodafone to return $84 billion to shareholders
By Kate Holton and Ilaina Jonas
LONDON/NEW YORK, Sept 2 Verizon Communications
agreed on Monday to pay $130 billion to buy Vodafone
out of its U.S. wireless business, signing history's
third largest corporate deal to bring an end to a decade-long
The two firms said Vodafone would get $58.9 billion in cash,
$60.2 billion in Verizon stock, and an additional $11 billion
from smaller transactions that would take the total deal value
to $130 billion.
The British group will return 71 percent of the net proceeds
to shareholders. All the stock will go to shareholders, plus
$23.9 billion in cash, after the deal is finalised, likely to be
in the first quarter of 2014.
"This has been a highly productive partnership in a business
with excellent momentum," Vodafone Chief Executive Vittorio
Colao told reporters.
The boards of Verizon and Vodafone unanimously approved the
The deal will give Verizon full access to the wireless
unit's cash, handing it fresh firepower to invest in superfast
mobile networks and fend off challengers in a U.S. market
expected to grow more competitive in the coming years.
Verizon said it expected the transaction to be immediately
accretive to earnings per share by about 10 percent, excluding
any one-time adjustments.
While Vodafone will lose its best asset, it will get a war
chest that it can use to reward shareholders and bolster its
European operations, which are under pressure from recession and
The British firm said it planned to plough 6 billion pounds
($9.3 billion) into improving its mobile and broadband networks
over the next three financial years. It said the investment
programme dubbed Project Spring would help it boost growth to
underpin its increasing dividend payments to shareholders.
It will have a U.S. tax liability of around $5 billion.
The deal is likely to be the defining event in the careers
of Colao and Lowell McAdam, the congenial chief executives of
Vodafone and Verizon, who rebuilt relations between the two
sides to such an extent that they could complete the deal that
long eluded their predecessors.
The move to sell out of the joint venture closes a heady
expansionist chapter for Vodafone, one of Britain's best-known
companies, which grew rapidly over the last 20 years through a
spate of aggressive deals, taking its brand into more than 30
countries across Europe, Africa and India.