Colao eyes windfall from $130bn Vodafone deal with Verizon Wireless

Vodafone’s chief executive Vittorio Colao could be in line for a £5.5m personal windfall from the sale of its 45 per cent stake in Verizon Wireless to America’s Verizon Communications.

Talks between the two sides are understood to have gone well over the weekend as the boards of Vodafone and Verizon Communications put the finishing touches to the deal, which could be announced as soon as today despite it being a holiday in America.

Vodafone is set to receive $130bn (£84bn) or around 174p per share, making it the third largest takeover in stock market history. The FTSE 100 giant is expected to return close to half that amount, around £40bn, to shareholders in special dividends, worth as much as 82p a share, with the rest used for acquisitions and to reduce debt.

Mr Colao holds 6.8 million Vodafone shares, making a payout potentially worth about £5.5m, but analysts cautioned any return to shareholders is likely to be staggered over several years and might not be only in cash.

Reports suggest Vodafone can reduce its tax bill on the sale to below $5bn. Sources close to the company dismissed claims it could structure the sale through Luxembourg and noted recent changes in UK tax law meant it faces only a small liability.