Verizon Wireless, a joint venture of Verizon Communications Inc. (NYSE: VZ) and Vodafone Group (NASDAQ: VOD), will distribute a total of $8.5 billion to its owners by Dec. 31, its second payout in 12 months, Thomas Gryta reports for The Wall Street Journal.
Stifel Nicolaus analyst Christopher King said Verizon Communications will use the wireless distribution to pay shareholders its quarterly dividend, which it upped to 51.5 cents in September.
Verizon Communications reported $9.7 billion in cash at the end of September and $29.8 billion in cash flow from operations in 2011.
Verizon Wireless has been upgrading its network to next-generation LTE technology and expects to complete the effort by mid-2013.
Gryta noted that Verizon Wireless has been a source of strength for Vodafone, which is scheduled to report its first-half financial results early Tuesday.
In February, Vodafone paid shareholders a special dividend of £2 billion for its January distribution. This decision was made in July 2011, shortly before Lowell McAdam, then head of Verizon Wireless, replaced Ivan Seidenberg as CEO of Verizon Communications.
According to a Verizon spokesman, Verizon “will continue to be good stewards of cash.” He declined to comment on the timing of the dividend payout.
