OREANDA-NEWS. Vodafone  announces that it has  reached agreement to dispose of  its  US group whose principal asset is its 45% interest in Verizon Wireless (“VZW”)  to Verizon Communications Inc. (“Verizon”  –NYSE: VZ), Vodafone’s joint venture partner, for a total consideration of USD  130 billion (Ј84 billion).
The consideration comprises:
–  USD  58.9 billion (Ј38.0 billion) in cash;
–  USD  60.2 billion (Ј38.9 billion) in Verizon shares
–  USD  5.0 billion (Ј3.2 billion) in the form of Verizon loan notes;
–  USD  3.5 billion (Ј2.3  billion) in the form of Verizon’s 23%  minority  interest in Vodafone Italy;
and
–  USD  2.5 billion (Ј1.6 billion)  through  the assumption by Verizon of Vodafone  net  liabilities relating to the US Group.
•  The VZW Transaction represents an attractive valuation of 9.4x EV / LTM EBITDA and 13.2x EV / LTM  OpFCF.
•  Vodafone intends to implement a new  organic  investment programme, Project Spring, to establish  further  network and service leadership through additional investments  of  Ј6 billion over the next  three financial years.
•  At completion,  Vodafone  shareholders are expected to receive  all the Verizon shares and USD  23.9  billion of cash (the “Return of Value”)  totalling  USD  84.0  billion  (Ј54.3  billion),  equivalent to 112p  per share and representing 71% of the Net Proceeds.
•  Vodafone expects that strong free cash flow generation will continue to underpin shareholder  returns. The Board, therefore, intends to increase the total 2014 financial year dividend per share by  8% to 11p, and intends to grow it annually thereafter.
•  Subject to the satisfaction of certain conditions precedent, the Transactions are expected to  complete in Q1 2014.