Vodafone tipped to bid $55 bln for AirTouch
LONDON, Jan 6 - Britain's Vodafone Plc plans to trump rival suitor Bell Atlantic Corp in the bidding for U.S. cellular phone company AirTouch Communications Inc , according to newspaper reports on Wednesday.
The Financial Times said Vodafone, Britain's biggest mobile phone company, had proposed a merger deal that values the U.S. company at about $55 billion.
The Vodafone offer would be an attempt to land a knockout blow against rival Bell Atlantic Corp , which is seen offering about $45 billion in stock for AirTouch.
The Wall Street Journal, citing people familiar with Vodafone's proposal, said Vodafone was planning to offer stock valued at around $89.56, plus $5 to $6 per share in cash.
For its part, the Financial Times said the unsolicited bid is thought to be worth more than $90 a share. AirTouch shares closed at $75 on Tuesday.
The Vodafone bid, mainly stock but with a small cash element, was submitted by Goldman Sachs over the weekend after the disclosure that Bell Atlantic and AirTouch were in talks, the FT added.
Vodafone confirmed on Tuesday that it had made an approach to AirTouch regarding a possible merger. But it gave no details of any terms.
The Vodafone statement came just two days after AirTouch, the world's largest wireless company, confirmed it was in merger talks with Bell Atlantic.
The Vodafone announcement helped to push Vodafone shares to a record high of 1,124-1/2p in London on Tuesday before they eased back to end at 1,103.
Bell Atlantic declined to comment on the rival Vodafone move. Sources close to Bell Atlantic said the company planned to continue talks for a possible AirTouch acquisition.
AirTouch has joint ventures with both of its suitors, who have long been viewed as potential buyers of the San Francisco-based company. Either bidder would make a strong match for AirTouch, analysts said.
AirTouch and Vodafone are partners in Sweden and Egypt and have other complementary international assets. Vodafone is strong in northern Europe, while AirTouch has a presence in Spain, Italy, Portugal and the Asia-Pacific region.
Meanwhile, AirTouch also has a U.S. partnership with Bell Atlantic called PrimeCo Personal Communications LP.
Through an acquisition, Bell Atlantic aims to combine its East Coast network with AirTouch's strong West Coast presence, creating a national wireless behemoth to challenge industry leader AT&T Corp .
Bell Atlantic already plans to merge with telecommunications company GTE Corp. in a $52.8 billion deal, but the addition of AirTouch could dramatically bolster its wireless presence. GTE, which is based in Irving, Texas, would have to approve any acquisition of AirTouch.
The combined Bell Atlantic, AirTouch and GTE also could sell packages of communications services -- including wireless, local and long distance and Internet and data services -- and would have direct access to 80 percent of the U.S. population, analysts said.
Analysts said the two suitors could even split AirTouch's assets -- with Vodafone buying the international operations and Bell Atlantic buying the domestic business.
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