Vodafone signalled yesterday the UK mobile phone group expects to start receiving dividends again from Verizon Wireless next year.Verizon Wireless, the second-largest US mobile operator, emerged last week as the highest bidder in a radio spectrum auction. That development prompted fresh questions about when the company would resume dividend payments.
Vodafone has a 45 per cent stake in Verizon Wireless, the remainder held by Verizon Communications, the US telecommunications group.Last Thursday regulators announced Verizon Wireless had agreed to pay $9.4bn for spectrum that should enhance its mobile broadband services. That sum exceeded some analysts' expectations, and could increase Verizon Wireless' debt to $17bn-$20bn.
Verizon Wireless last issued dividends in 2005, when Vodafone received £923m. The payments dried up after Verizon Communications decided to use Verizon Wireless' cashflow to pay down the mobile operator's debt.Verizon Communications has management control of Verizon Wireless. It declined yesterday to give a timetable for the resumption of dividend payments: "Cash distribution policy for 2009 and beyond will be made by the Verizon Wireless board, which will assess a whole range of factors in making its decisions on timing."
Vodafone signalled it was sticking by its assertion last year that the world's largest mobile group by revenue should get dividends sometime next year.
Source : http://www.ft.com/
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