Verizon Communications was poised yesterday to finally take full control of its US wireless business with a US$130 billion deal that would buy out Vodafone and bring an end to a decade-long corporate standoff.
The British firm said late on Sunday that it was in advanced talks with Verizon to sell its 45 percent stake in the Verizon Wireless joint venture for cash and common shares in what would be the world’s third-largest deal of all time.
People familiar with the situation said they expected a full announcement to come after the London stock market closed yesterday, and after the board of Verizon met earlier yesterday to vote on the proposed transaction.
The move to sell the jewel in Vodafone’s crown closes a heady expansionist chapter for one of Britain’s most famous companies, which grew rapidly over the last 20 years through a spate of aggressive deals to operate in more than 30 countries across Europe, Africa and India.
The new Vodafone will be smaller, less profitable and more reliant on its core, mature European assets, but it is expected to use the huge windfall to rebuild via smaller acquisitions and higher network investments.
Speculation has already begun that Vodafone could itself become a bid target, and news of the pending deal sent its shares up 4 percent to a more than 12 year high in early London trade yesterday.
Under the terms of the proposed agreement, Vodafone would get US$60 billion in cash, US$60 billion in Verizon stock, and an additional US$10 billion from smaller transactions that will take the total deal value to US$130 billion, two of the people familiar with the matter said on Saturday.
To fund the cash portion of the deal, Verizon has lined up as much as US$65 billion in financing from four banks: JPMorgan Chase & Co, Morgan Stanley, Barclays PLC and Bank of America Merrill Lynch, they said.
The banks have committed to the financing which is expected be split evenly among the four, two people said.
If the deal is concluded, it will end one of the longest-running corporate standoffs, which has at times seen both partners seek to buy out the other in times of weakness.
For Verizon, it means that it no longer has to share the billions in cash generated by Verizon Wireless.
On the Vodafone side, chief executive Vittorio Colao will get a war chest of cash to reward shareholders and potentially carry out acquisitions to strengthen the group’s European and emerging market operations.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts