Vodafone Group plc (VOD) To Use Cash Infusion For Networks Rather Than Acquisitions
Vodafone Group plc (LON:VOD) has dispelled rumors about how the telecommunications company will be using their cash infusion for large acquisitions. Vodafone Group plc (LON:VOD) will be using their cash infusion for investing in their networks across Europe and emerging markets. Verizon Communications Inc. is paying Vodafone $130 billion for their 45% stake in Verizon Wireless.
Vodafone said that they have no interest in getting in a spending spree as they have just completed the takeover of Germany’s largest cable operator Kabel Deutschland for 7.7 billion euros.
Once this deal is complete, the group will return around $84 billion to shareholders in the first quarter of 2014. Vodafone Group plc (LON:VOD) will be spending 7 billion pounds ($11.2 billion) over the next two years, which is around 1 billion pounds more than announced before.
“The pending $130 billion U.S. transaction will reward our shareholders for their long-term support of our strategy and will provide us with a strong balance sheet, improved dividend cover and the financial and strategic flexibility to make further investments in the business or returns to shareholders in the future,” stated Vodafone CEO Vittorio Colao.
Vodafone Group plc (LON:VOD) recently reported a net profit attributable to shareholders of 17.95 billion pounds in the half year to end-September compared to a loss of 1.98 billion pounds during the same period last year.