what's this I hear about a VodoFone/Cingular US market???

Since Vodafone own a large chunk of Verizon, that would spark major antitrust issues, unless (as has been rumoured) they divest themselves of their Verizon stock. In any case, such a deal would be absolutely YEARS in the making.

 

I believe Vodaphone already missed the window they had to get bought out of the agreement with Verizon, which I believe was 4-6 months ago.

 

Vodafone has been whining (with good cause) about having to pay roaming fees to their European competitor (DT/T-Mobile) for a while now. They probably should have looked into network compatability or stipulated something in the joint venture contract. Cingular would seem to suit them well. They are going for GSM and are the #2 wireless provider in the country. The only problem is that I get the feeling that Vodafone wants a US company to use the Vodafone brand. There is no local/long distance tel. co. that uses the Cingular name so that might be possible in a way that it wasn't with Verizon, but it would still cost a lot to rebrand especially after they just rebranded to Cingular.

Vodafone doesn't want to be left out of the game. They're either going to put the screws to Verizon to make them switch or try to buy someone else (at quite a steal the way the US market is now).

 

The NYTimes says that they have th oppertunity to sell back to Verizon in Summer 2003.

 

http://news.independent.co.uk/business/news/story.jsp?story=366536

Vodafone plans $20bn sell-off to fund bid for US competitor
By Jason Nissé
05 January 2003

Vodafone is planning to sell its $20bn (£12.5bn) interest in its US venture Verizon Wireless in order to make a bid to take full control of a rival US mobile phone operator.

US sources say Vodafone has shown interest in both Voicestream, the American mobile arm of debt-laden Deutsche Telekom, and AT&T Wireless, whose largest shareholder is Jap- anese operator NTT Docomo.

To fund a bid, Vodafone will exercise its option to sell its 44.3 per cent interest in Verizon Wireless to the majority shareholder Verizon Communications.

Under the shareholder agreement, Vodafone can force Verizon to buy half the stake this July for $10bn and the rest of the holding a few months later for the same amount. Such a move would enable Vodafone both to raise cash for a US bid and to avoid anti-trust problems if it bought another American mobile phone business.

Analysts in the UK have speculated that Arun Sarin, the former head of Vodafone's US operation who will take over as group chief executive this spring, wants to expand Vodafone's operations in the US.

However, the group's relations with Verizon Wireless were strained when the US business chose to adopt the CDMA mobile standard rather than the GSM version used by Vodafone in the rest of the world. US sources say Vodafone wants to use GSM in the US, of which the two main users are Voicestream and AT&T Wireless.

Deutsche Telekom has said it wants to cut its €64bn (£41bn) debt. Chief executive Helmut Sihler said it was keeping all its options open over Voicestream, which it bought for $50bn in 1999. It is understood to have held talks about selling the business to US operator Cingular and is expected to put the business up for sale formally early this year. US sources say Vodafone could buy the business for less than $30bn, a relative bargain compared to prices Vodafone has paid in the past.

AT&T Wireless is also believed to be in play, with NTT keen to release funds to shore up its Japanese operations. The company is valued at $17bn on the New York Stock Exchange and has debts of $14bn.

Vodafone would not comment on its US strategy plans. However, the group's chairman, Lord MacLaurin of Knebworth, has previously told The Independent on Sunday that what to do in the US is high on its agenda and a decision may be needed before Mr Sarin takes over at the start of April.

 

My personal opinion is that Voda will land up with AT&T. VZW won't ever switch to GSM as long as Verizon Communications is in control, SBC won't let go of Cingular, BellSouth is rumored to still want all of Sprint -- including SPCS (and Voda would have to convert SPCS), T-Mo/DT would be stupid to sell the US to Voda and then land up paying roaming to them, and Nextel is an oddball no one really wants (and they're doing well enough on their own.)

-SC