VODAFONE boss Vittorio Colao initially pushed for a merger with US firm Verizon Communications instead of selling its share in the jointly owned US wireless business, it was revealed last night.
Documents filed last night by Verizon in New York also reveal Colao was instrumental in rejecting a $95bn (£59.5bn) offer eight months before finally agreeing to accept $130bn for its 45 per cent stake in the US wireless unit to secure the third-largest deal in corporate history.
At the start of the year Colao and Vodafone chairman Gerard Kleisterlee told Verizon they felt that $95bn “represented inadequate consideration” for Vodafone’s stake, according to the filing. Bartering over price continued until Vodafone eventually agreed to accept what Verizon chief executive Lowell McAdam said was his “best and final” offer of $130bn.
The filing last night in New York is aimed at providing Verizon’s shareholders with the information they need to vote on the deal.
It also reveals that if the deal were to fall apart, Verizon would have to pay a break fee of up to $10bn.
On its side, Vodafone would need to pay Verizon up to $1.6bn in the unlikely situation of its shareholders not approving the transaction.
Verizon’s filing also revealed costs relating to the deal so far totalled $250m. The tally includes investment banking fees but not financing costs.
Verizon’s bankers JP Morgan and Morgan Stanley will receive fees of about $129m each for the deal, according to the filing.
Assuming the deal goes through, Verizon will gain a second listing in London on top of its US listings as much of Vodafone’s payment for the US wireless business will be in stock options. Vodafone declined to comment yesterday.