The power play over control of Verizon Wireless could be set to take another turn as an industry analyst noted that the wireless carrier may not pay out a dividend to its parent companies in 2013, after having paid out $18.5 billion in payments over the past two years.
According to a Bloomberg story, JP Morgan Chase & Co.’s Philip Cusick noted in a research note that after a meeting with Verizon Communications management, Verizon Wireless was looking at paying down debt instead of paying out a dividend. Verizon currently controls 55% of Verizon Wireless, but has made it clear that it would be interested in acquiring Vodafone Group’s 45% stake in the domestic wireless operator.
Cusick also wrote that Verizon did not think it would need to provide a premium to a planned offer for full control over Verizon Wireless, citing the fact that it has basically controlled the decision making at the wireless carrier with little input from Vodafone.
“Management believes that a premium would not be warranted for the minority stake given Verizon’s management control,” Cusick wrote.
Verizon has reportedly been lining up $100 billion offer to purchase Vodafone’s stake in Verizon Wireless, though reports indicated that Vodafone investors were expecting a higher offer.
Verizon Wireless has paid out $18.5 billion in dividend payments to its parent companies beginning in early 2012.
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