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case study: Vodafone's stake - Essay Example
Finance & Accounting
Pages 14 (3514 words)
Vodafone’s stake a. History of the Joint Venture The telecommunication industry of United States has gone through revolutionary changes in the area of digitalization and technology. The main players of the markets of United Kingdom and United States are named as Vodafone Group Plc…
The history behind the joint venture is elaborated below. In 2000, Bell Atlantic Corporation and Vodafone AirTouch Plc. agreed for joint venture of $70 billion joint venture that created the largest mobile phone company of nation, Verizon Wireless. The new venture has 3.5 million paging customers and 20 million cellular users. The agreement of joint venture was a major step in the strategy of United States. It is very important to gain a nationwide recognition when the growth of the telecommunication industry is fast and the penetration level of new companies is less. The new venture combined the assets from AirTouch Cellular, Bell Atlantic Mobile, PrimeCo Personnel Communications, AirTouch Paging and GTE Corp which comprised around 90% of the population of Unites States. It took 26% of the total national market share of the country. The new venture needed to divest some overlapping holdings for meeting the requirements of Federal Communication Commission. The transaction for the joint venture is expected to complete within 6 to 12 months. The venture introduced a strong player in the United States wireless market with an asset value of $5 billion. The venture competed with the strong competitors like Sprint PCS and AT&T, who had a 12.9% and 5.7% control on the national market respectively. ...
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