Like undercooked shellfish, the story of Vodafone supposedly planning to sell its stake in Verizon Wireless to Verizon is impossible to keep down.
It is one that has rumbled on more or less all year, but it finally looks like the situation might come to a head, after the U.K. mobile giant on Thursday confirmed it is in talks with Verizon to dispose of its 45% stake in its U.S. joint venture.
Cue a flurry of activity as industry observers salivated over sky-high, albeit yet-to-be agreed, asking prices in the region of $100-$130 billion.
However, also a bit like undercooked shellfish, there are some who cannot stomach the thought of Vodafone exiting Verizon Wireless.
"The last thing I want to do is give $100 billion or more to the current Vodafone CEO," said John Hempton, chief investment officer of Australian hedge fund and Vodafone shareholder Bronte Capital, in an email to Total Telecom on Friday.
The last time we looked at 'Verizafone' in a Friday Review, Hempton said it would be insane for Vodafone to sell its Verizon Wireless stake, and the best outcome for shareholders would be the sale of the whole of Vodafone instead.
"The next best outcome is no deal at all," he said in March, adding that the entire Vodafone board deserved to be sacked if it pursued the disposal of Verizon Wireless.
A few months on, and Hempton's stance has not softened at all.
"There are various sensible deals, but almost all of them involve the management of Vodafone riding off into the sunset without a phone company," he said on Friday.
Ouch.
Not everyone shares Hempton's point of view though.
"The proceeds from the sale, if not passed on in the form of dividends, could improve its debt position following the recent Cable & Wireless and Kabel Deutschland deals, and provides Vodafone some leeway to further expand its network presence in Europe," said Ronald Klingebiel, assistant professor of strategy at Warwick Business School.
"Such moves provide the capacity and level of integration necessary for competing effectively in a future pan-European market," he said, noting also that consolidation is
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