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Verizon no longer wants its wireless destiny tied to the European carrier Vodafone.
Verizon is reportedly working to take full ownership over Verizon Wireless, its joint venture with Vodafone, reports Bloomberg. Among the potential options, Verizon is apparently considering a buyout of Vodafone’s 45 percent stake (worth around $115 billion, according to analyst estimates) or a massive merger.
Judging from what Bloomberg is hearing, it doesn’t sound like the merger is very likely. Two sources say the companies discussed a potential union in December, but they ended up disagreeing on headquarters location and leadership structure. A merger would also be one of the biggest corporate takeovers ever, considering Verizon’s $130 billion market cap and Vodafone’s $120 billion.
In the end, it’s much simpler for Verizon to pay.
And with Verizon Wireless being its most profitable division, it makes sense for Verizon to want full control. It could lead to more creative subscription plans, new types of advertising, or perhaps even business ideas we haven’t even considered.
At its CES booth in January, Verizon focused heavily on the many ways it could use its wireless network outside of phones. For example, it could power video headsets for firefighters, which would help them to pull up building schematics on the fly, or it could connect solar recycling bin to alert operators when it’s full.
Vodafone’s chief executive Vittorio Colao has also been actively trying to sell off its stakes in joint operations, Bloomberg points out, so he would likely welcome Verizon’s buyout offer.
Verizon hasn’t been shy about wanting to take over its wireless division over the past few years. Verizon Wireless was born from a joint venture between Bell Atlantic (which would later become Verizon) and Vodafone in 1999. Given just how much the mobile landscape has changed since then, it simply makes sense for Verizon to want to break things off.
Photo: Eric Hauser /Flickr