if VZ kills the Divy - VOD will crash = VOD goes down in price - = VZ swoops in like dracula. = VZ gets
the 45 % VOD holds on the cheap. - what a game plan for VZ. - no divy - no high dollar to buy for VOD.
VOD blew it - when they didn't have representation on the VZ board. - like $ $ BILLIONS .
Too clever by half. There is nothing to prevent VOD demanding the amount of the withheld dividend as an add on to the price. If VZ is serious, withholding the dividend this year is irritating, dumb move. It takes two to make a deal.
VZ, which owns 55% of VZ wireless, needs the dividend from wireless just as much, if not more, than VOD. If they omit the dividend from wireless, then VZ's stock would tank, and any hopes of acquire the rest of VZ wireless would vanish.
I agree that VZ needs the VZW dividend more than VOD. However, I don't know if VZ will tank if they pay off VZW debt instead of paying a dividend to VZ and VOD. VZW financials will still be reflected in VZ results, and VZ can cheaply borrow any funds it needs. VZW can borrow cheaply too, so repaying the debt is unnecessary.
That said, if continued, not paying a VZW dividend could eventually hurt VZ and #$%$ off VOD. And in the mean time, the value of VZW would rise, VZ's balance sheet may become more leveraged, and interest rates could rise from all-time lows. So there's a good case to be made that if a deal is delayed it would be more challenging for VZ to eventually own all of VZW and if they do, it'll cost them a more than paying up today.
(Hey Smalls, notice I also like to be my own devil's advocate, not just yours!)
You way underestimate VOD. Everyone and their dog knows VOD is undervalued and VZ won't be doing anything with VOD on the cheap. VZ can keep throwing a temper tantrum but it isn't going to get them anywhere acting like a brat. VOD doesn't need that divy like VZ does. Go ahead VZ. Cut off your nose to spite your face.