European Communications

Last update01:22:38 PM

Verizon denies Vodafone merger reports

Verizon Communications has denied it wants to buy or merge with Vodafone following press reports indicating that the US-based company could make a joint move for the UK operator with its arch rival AT&T.

In a statement, Verizon said it has no plans for a bid, but confirmed it remains interested in buying Vodafone's 45 percent stake in Verizon Wireless.

"Verizon Communications Inc notes the recent press speculation regarding a potential merger with or purchase by Verizon of Vodafone," the company said.

"As Verizon has said many times, it would be a willing purchaser of the 45 percent stake that Vodafone holds in Verizon Wireless. It does not, however, currently have any intention to merge with or make an offer for Vodafone, whether alone or in conjunction with others."

On Tuesday, Vodafone shares jumped to a ten-year high on the back of reports that Verizon and fellow US firm AT&T were readying a joint bid.

However, Vodafone shares fell 3.4 percent following Verizon's statement that it has no plans to make an offer.

Verizon owns 55 percent of Verizon Wireless and has been open about its intention to buy out Vodafone for years.

For some months there has been speculation about a Verizon Wireless deal between the two firms, with Vodafone chief executive Vittorio Colao saying he had an "open mind" about the US carrier.

However, it is rumoured that proposals for a deal stalled because such a move could leave Vodafone with a large tax bill should it sell some or all of its stake, given that Verizon Wireless' value is now significantly higher than when it was formed in 2000.

In November last year, Vodafone unveiled a new strategic approach after it made a €2.4 billion loss. The operator's poor financial performance came despite the billion dollar windfalls received from its stake in Verizon.

Last month, Verizon replaced Vodafone as the most valuable telco brand in the world, according to the annual ranking by consultancy brand finance.