NEW YORK, Sept. 2 (Xinhua) -- Verizon Communications Inc. on Monday announced that it has agreed to buy 45 percent stake in its wireless business held by Vodafone Group PLC of Britain for 130 billion U.S. dollars in both cash and stock.
The acquisition would become the third largest announced deal in the world's history. The transaction is expected to close in the first quarter of 2014, according to announcements of both companies.
Verizon Wireless, founded in 2000 as a joint venture of Verizon and Vodafone, is the largest U.S. wireless company, with 100.1 million retail connections by the end of the second quarter of this year. It operates the country's largest 4G LTE -- advanced wireless broadband -- network.
On completion of the deal, Verizon would be provided with 100 percent ownership of the industry-leading wireless carrier in the United States.
According to the agreement, Verizon will pay Vodafone 58.9 billion dollars in cash and 60.2 billion dollars of Verizon common shares. In addition, Verizon will issue 5.0 billion dollars in notes payable to Vodafone, and Verizon will also sell its 23.1 percent minority stake in Vodafone Omnitel N.V. to Vodafone for 3. 5 billion dollars.
The two companies said that the transaction was unanimously approved by the boards of directors of both Verizon and Vodafone, and it is subject to regulatory approvals and the approval of both companies'shareholders.
"Over the past 13 years, Verizon Wireless has been a key driver of our business strategy, and through our partnership with Vodafone, we have made Verizon Wireless into the premier wireless provider in the U.S." said Lowell McAdam, Verizon chairman and CEO. McAdam said that the capabilities to wirelessly stream video and broadband in 4G LTE complement the company's other assets in fiber, global IP and cloud. These assets position the company for the rapidly increasing customer demand for video, machine to machine and big data. He also expressed his confidence in the company's further growth in wireless, as well as business in its entirety.
Vodafone, a British giant in communications industry which has expanded its business across the globe in the past two decades, said it would return all the Verizon shares plus 23.9 billion dollars in cash, totaling 84.0 billion dollars which is equivalent to 71 percent of the net proceeds from the deal, to its shareholders.