Vodafone in sights of US group

Shares rose by 2.5 per cent after financial news wire Bloomberg reported that AT&T was laying the groundwork for a potential deal for Vodafone.

The FTSE 100 company is in the process of selling its stake in US venture Verizon Wireless for £84bn.

The report said there had not been any formal negotiations but that AT&T is intensifying work on which Vodafone assets it would retain following a deal.

The communication giant’s chief executive Randall Stephenson is said to excited by the “huge opportunity” to invest in mobile broadband in Europe and is reportedly interested in Vodafone or British rival EE.

Vodafone is currently valued at more than £110bn as it prepares to complete the third-largest corporate transaction in history, comprising a cash and shares deal with its joint venture partner in Verizon Wireless.

The bulk of the proceeds will go to Vodafone shareholders, while Berkshire-based Vodafone plans to plough £6bn into organic investment, including in boosting its 4G, 3G, fibre and broadband services.

Espirito Santo analyst Robert Grindle said it was logical for AT&T to consider its options regarding Vodafone, following its US exit.

“What we don’t have full clarity on is how ambitious AT&T is,” he said.

“(The report) is short on substance but long on plausibility.”

Vodafone and AT&T declined to comment.