This blog gives you the latest topical news plus some informal comments on them from ShareSoc’s directors and other contributors. These are the personal comments of the authors and not necessarily the considered views of ShareSoc. The writers may hold shares in the companies mentioned. You can add your own comments on the blog posts, but note that ShareSoc reserves the right to remove or edit comments where they are inappropriate or defamatory.

Vodafone and Verizon – how will they use the cash?

ShareSoc has issued a press release on the likely deal for Vodafone to sell its stake in Verizon Wireless (see www.sharesoc.org/pr50vodafone.html). This might realise over US$100bn in cash so the key question is what the company will do with it. Will it waste it on other acquisitions or return it to shareholders? And in the latter case in what form?

Vodafone is a company that appears to love share buy-backs like many FTSE-100 companies. But ShareSoc suggests that it would be better returned via special dividends or tender offers. Ideally shareholders should have the option to receive it as either income or capital so they can choose which is more tax efficient.

Roger Lawson

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