Verizon Wireless will make a long-awaited dividend payment to parent company Vodafone Group at the end of next year, the company said Thursday.
The payout – Verizon's first dividend payment to Vodafone since 2005 – will help make amends between the operator and its U.K. co-parent company. Vodafone owns 45 percent of Verizon Wireless and Verizon Communications holds the remaining 55 percent stake.
Verizon Wireless will pay $5.5 billion to Verizon Communications and $4.5 billion to Vodafone Group on Jan. 31, 2012. Vodafone's stock rose more than 4 percent on the news, while Verizon's dipped about 1 percent.
The company did not say whether the dividend would be a one-time payment or whether it would occur on an annual basis.
Verizon did not issue any comment on the payout beyond its amount and date, but pending company CEO Lowell McAdam said during the company's latest earnings call that he was "pleased with the evolution of our partnership with Vodafone. We are clearly moving from a purely financial partnership to an operating partnership."
Verizon Wireless and Vodafone have improved their relationship in recent quarters, working together on joint services for the enterprise segment. Verizon's top executives have been hinting for months about a possible dividend payment, but declined to say when it would make the payout as recently as its second-quarter earnings call last week.
Vodafone has increased ties with its American wireless subsidiary despite moves to divest some of its other international holdings.
The company has sold off its stakes in Japanese operator Softbank, China Mobile and French wireless operator SFR, prompting some to speculate it would also attempt to offload its shares in Verizon Wireless. However, yesterday's announcement makes that unlikely, at least in the short term.