With Vodafone Deal Done, Verizon Officially Passing on Canada
Verizon Wireless is officially taking a pass on breaking into the Canadian wireless market.
Bloomberg spoke with CEO Lowell McAdam and he confirmed Verizon would not be heading into the Great White North. As the same report points out, Canadian analysts are expecting a huge sigh of relief from big incumbent Canadian carriers Rogers, Telus and Bell to go along with big stock boosts for all three.
Last week, when news surfaced of intensified talks between Verizon and Vodafone regarding a buyout of Vodafone’s 45-percent stake in Verizon Wireless, many assumed the pricey move would leave little room for Verizon’s Canadian aspirations. Over the weekend, Verizon and Vodafone finalized the $130 billion deal, the sum total good enough for second-biggest acquisition on record ever.
But as McAdam said in the Bloomberg report, Verizon is not backing off its pursuit of Canadian wireless market share because of the Vodafone deal. Instead, McAdam said Verizon is skipping Canada because it doesn’t see “great value creation” for its shareholders.
Whatever the reason for Verizon’s decision, Canadian carriers are rejoicing. As the Canadian government approaches a spectrum auction scheduled for 2014, the Canadian carriers have been extremely vocal in advocating for Ottawa to close loopholes that would give unfair auction advantages to foreign entrants. It was assumed that Verizon would attempt to buy small Canadian carrier Wind Mobile and bid on the 700 MHz spectrum licenses Canada was putting up for auction.
Now it appears Verizon will have its hands full officially closing the deal with Vodafone. Owning 100 percent of Verizon Wireless has long been a dream for Verizon and after a few more regulatory hurdles are jumped, Verizon should finally fry that fish. The Verizon-Vodafone acquisition is expected to be finalized by the first quarter of 2014.