Vodafone US exit could lead to Liberty bid

VODAFONE could use the tens of billions of pounds it would receive from selling its US interests to finance a bid for Liberty Global, the broadband giant.

Analysts at Citigroup yesterday said that Vodafone would receive up to £85bn from selling its 45 per cent stake in Verizon Wireless, the US mobile network, to majority owner Verizon Communications. The bank said that this would open the door for a bid of around £50bn for Liberty Global, which has broadband networks in 11 European countries and is set to move into the UK with the £15bn purchase of Virgin Media.

Buying Liberty Global, which is controlled by US billionaire John Malone, would fit in with Vodafone chief Vittorio Colao’s plan to expand by offering more internet and TV services to customers, in addition to the mobile networks which make up its core business.

Citigroup’s Simon Weeden added that Vodafone would be able to proceed with selling its Verizon Wireless stake without a substantial tax liability, which has been seen as one stumbling block.

Verizon Communications has repeatedly stated its interest in buying Vodafone’s stake, valued at up to £100bn, although Colao is believed to be relaxed about the situation.