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Just what is Vodafone doing with Verizon?

Comment Activist shareholders may be right
Sun Jun 10 2007, 11:33
A MOVE by a very small group of activist shareholders in Vodafone has thrown the spotlight once again on Vodafone's 45 per cent holding in Verizon Wireless.

The INQ has long argued that as a global leader in the GSM market, it makes little sense for Vodafone to hold an interest in a US Cdmaone operator not a GSM based one.

Vodafone could use its clout with GSM handset and infrastructure suppliers to give a competitive edge to a small US based GSM network operator.

Vodafone isn't like Virgin which backs Cdmaone in some countries and GSM in others. Virgin Mobile is a virtual operator so it doesn't have to care too much about the technology.

The group of Vodafone activists is led by John Mayo of Efficient Capital Structures and shows no sign of winning over sufficient shareholders to back its proposals. Mayo was at Marconi which was hardly a shining example of a well-run comms company.

Mayo's proposals involve spinning-off holdings in non-core activities which would include the Verizon holding. As a financial measure, it might not be a sound idea for existing shareholders.

But it might just force Arun Sarin, Vodafone's CEO, to flesh out his company's plans of one of the world's most important mobile markets - the USA.

After all, the one country where being able to data roam with your SIM card is useful is in the USA. Yet your Vodfone SIM card won't roam onto the Vodafone partner network, Verizon, unless your handset is an obscure dual mode device. µ


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