Shares in Vodafone rise 2.5 percent on renewed speculation that the Britishfirm could be working towards a deal to either sell its 45 percent stake inVerizon Wireless in the United States, or merge itself with the Wireless unit'sco-parent Verizon.
Three people familiar with the situation have told Reuters that Vodafone isworking with lawyers from Linklaters, bankers from UBS and consultants fromMcKinsey to look at options and structure for a deal, and for ways to reduce apossible tax bill. The sources say the two sides have held ongoing talks forsome time to discuss options.
A report in the Sunday Times said Vodafone was now leaning towards a sale ofthe U.S. unit, with a deal possible in the Summer. Vodafone's 45 percent stakeis valued at around $115 billion.
"This news has not been officially substantiated by either party but weexpect it will still be supportive for Vodafone's shares, especially as thetiming suggested is sooner than previously reported," analysts at Espirito Santosay in a note.
"We believe Verizon has not changed its position in stating that it wantsmore of Verizon Wireless as a deal would be accretive and give it more financialflexibility at a corporate group level. Vodafone also seems open to a deal ofsome kind so in our view it is now a question of agreeing on valuation terms."
Reuters messaging rm://kate.holton.reuters.com@reuters.net