Vodafone set for £2.9bn dvidend from US joint venture



Vodafone (LSE: VOD.L - news) is set to receive a $4.5bn (£2.9bn) dividend from its American joint venture after US regulators part-cleared a $3.9bn deal that will give Verizon Wireless greater network access.

The UK-domiciled mobile telecoms firm is expected to receive the dividend in the coming months from Verizon Communications, its US partner in mobile giant Verizon Wireless.

Analysts believe that the US Department of Justice’s decision to clear Verizon Wireless’s acquisition of mobile spectrum from rival companies could bring forward a dividend.

The deal still has to be formally cleared by the Federal Communications Commission, which is expected ahead of the Tuesday deadline. Verizon Wireless is 55pc owned by Verizon Communications, and 45pc owned by Vodafone .

The venture confirmed its first dividend, of $10bn, in July 2011, in part to fund Verizon Communications’ own payments to shareholders. “We believe that Verizon (NYSE: VZ - news) has been reluctant to sanction a dividend from Verizon Wireless before the spectrum deal closed,” said Will Draper, telecoms analyst at Espirito Santo. “Hence we believe that approval is likely to be followed by a Verizon Wireless dividend announcement.”

Analyst Tim Boddy, at Goldman Sachs (NYSE: GS - news) , believes that Verizon Wireless will declare its 2012 income dividend in the next four months possibly as soon as the joint venture’s next board meeting in mid-September.

It is expected that Verizon Wireless will press ahead with a further $10bn payment later this year.