Vodafone confirms it plans to sell Verizon Wireless stake

Britain's Vodafone PLC, one of the world's largest cellphone companies, has said it was talking to Verizon Communications about selling its stake in Verizon Wireless, the No.1 mobile carrier in the US.

The UK company is mulling options for its 45 per cent stake in Verizon Wireless. Verizon Communications Inc owns the other 55 per cent.

The partnership started in 2000, when what was then Bell Atlantic combined its East Coast wireless network with Vodafone's operations on the West Coast. Vodafone had entered the US market a year earlier by outbidding Bell Atlantic to buy AirTouch Communications Inc of San Francisco.

It has long been speculated that Vodafone, which is expanding in Europe, is interested in a US exit.

Verizon Communications has a long-standing interest in buying out its partner, but so far, the two companies haven't agreed on a price. Published reports say earlier talks on a sale broke down over price and tax concerns - and Vodafone stressed that there was no certainty a deal could be reached.

Analysts say Verizon wants to pay around $100 billion for Vodafone's stake, although reports suggest Vodafone is pressing for as much as $130 billion. At the higher price, it would be the second-highest acquisition deal on record, according to research firm Dealogic.

Verizon declined comment Thursday.

A sale isn't expected to have much of an effect on consumers or on Verizon Wireless' operations. Vodafone had little influence on Verizon Wireless' day-to-day operations, which made its stake more of an investment than a base from which to expand into the US market.

What would change is how the parent company and Vodafone record profits from the wireless business in their financial reports. Verizon Communications, which is based in New York, would get to record all of the wireless profits while Vodafone would get a cash payout.

Verizon Communications' stock rose $1.26, or 3 per cent, to close at $47.82 on Thursday. It had jumped $3.55, or 7.6 per cent, to $50.11 in premarket trading about an hour before the stock market opened. Meanwhile, Vodafone's London-listed share price rose 8.8 per cent to 2.06 pounds.