However, if that report has to be believed, the transaction involves: Vodafone would get $58.9 billion in cash, $60.2 billion in Verizon stock, and an additional $11 billion from smaller transactions that would take the total deal value to $130 billion. This report does not mention that, yet.
Now, if Verizon's market value is $136 b, and $60 b is given away to Vodafone, the latter would own about 44% of the former. But here new stock is being issued.
The headline should have been - 45% of Verizon Wireless is sold to Verizon, and 30.6% of Verizon is sold to Vodafone.
Who's better off? Whether the deal will create value, only time will tell.
The deal is supposed to become the third largest announced deal in the world after Vodafone's $203 b takeover of Germany's Mannesmann in 1999 and AOL's $181 billion acquisition of Time Warner in 2000.
You are free to check out the history about the aftermath.
Interestingly, this report provides more insight into this bizarre deal. It says - The acquisition will be structured almost equally between cash and shares and will include Verizon exiting its 23 percent stake in Vodafone Italia.
Now, the headline changes to - 45% of Verizon Wireless is sold to Verizon, 30.6% of Verizon is sold to Vodafone, and 23% of Vodafone Italia is sold to Vodafone.
This is really getting murkier. Imagine the deal which itself is almost equal to the market value of Verizon. Either the reporters don't know the exact details of the deal, or the deal is really bizarre.
I guess we need to wait for the coming days to get the real picture.
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