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Mergers and Acquisitions of Vodafone - Research Paper Example

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In this paper, the writer will discuss the dynamics involved in the deal of Vodafone and possible implications for different parties involved. The deal also generated up to nine billion dollars in capital gains tax for the United States and United Kingdom governments…
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Mergers and Acquisitions of Vodafone
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Download file to see previous pages Verizon Wireless, which had been a part of Vodafone Plc., was growing very fast, and Vodafone wanted to dispose of its assets in the United States and focus on Europe. Vodafone had not had much success with Verizon Wireless compared to its other subsidiaries in Europe and Africa. As a result, it identified Verizon Wireless as a possible obstacle to its expansion in Europe and Africa. On the other hand, Verizon Communications – the parent company of Verizon Wireless, wanted to solidify its presence in the US market after making several acquisitions in the past years. It should also be noted that Verizon Communications previously owned Vodafone Italy that was part of an agreement they had signed previously. Vodafone wanted to buy back Vodafone Italy so that it could shore up its operations in Europe while Verizon Communications wanted to solidify its presence in the US market. Out of all the motivations for this acquisition, the two core ones were Vodafone’s need to exit the US market and Verizon’s need to expand. The result was the acquisition. The positive impacts of the deal were far-reaching. Vodafone shareholders received cash payments as a result of the deal, and this boosted investor confidence in the company. Vodafone’s shareholders received large payouts and after this deal was more likely to stick with the company than ever before. On the other hand, Verizon’s shareholders were in line to receive increments in dividend income and possible increments in the company’s stock. ...Download file to see next pagesRead More
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