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$8.5bn bonus for Vodafone, Verizon Comms

Nov 13 2012 08:02 Reuters

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New York - Verizon Wireless said on Monday that its board agreed to pay a dividend of $8.5bn to its parents Verizon Communications and Vodafone Group.

The announcement follows months of investor speculation as to whether Verizon Wireless, which is controlled by Verizon Communications would choose to pay a dividend this year.

In the past the dividend has been a bone of contention for Vodafone shareholders, anxious to get a return on their ownership in the top US wireless service.    

Verizon Wireless, which is 55% owned by Verizon and 45% owned by Vodafone, said the distributions would be paid in one or more tranches, with each tranche paid in proportion to the owners' partnership interests.

The pay-out compared with a $10bn dividend announced by the company in July 2011. The dividends are due to be paid on or before December 31, Verizon Wireless said.

Verizon had suspended the dividend from 2005 until 2011 while it focused on paying down debt at Verizon Wireless.

Vodafone's US shares edged higher in late trade after closing at $26.39 on Nasdaq. Verizon shares rose to $42.62 after closing at $42.56 on the New York Stock Exchange. 

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