1. Last week was a momentous one for Vodaphone. Their shareholders agreed to sell the company’s 45% stake in the US mobile company Verizon Wireless (“VW”) for $130bn (£79bn). This sale will represent the third largest transaction in corporate history.
2. As a result of the vote in favour some 490,000 small retail UK investors in Vodaphone will share a £51m windfall. Whilst the exact allocation is still to be decided upon, it is expected that shareholders will receive 70% of this in shares in “VW” and 30% in cash. The cash element is expected to amount to £15bn, and the shares in “VW” worth £36bn.
3. The Chairman Gerard Kleisterlee has been quoted as saying “This is the largest ever single return of value to shareholders and, in our view, rewards our shareholders for their long term support of Vodaphone’s US strategy.”
4. With the share price in Vodaphone at £21.92 the overall return to shareholders amounts to 104p a share. It is expected that once distributed the share price will fall by roughly the rate of the windfall.
5. The dates to remember are:
· 24th February - “VW” shares will be distributed to shareholders
· 4th March - cash payment will be made
6. Before the 24th February I expect there will be many brokers offering their services to sell your shares, and their commission rates will vary depending on the number of shares you have to sell.
Charles Little
