Verizon Wireless

In the US, our associate Verizon Wireless has continued to perform strongly. Organic service revenue increased by 5.8%(*) led by a 3.1% increase in the customer base to 88.4 million and strong data revenue growth driven by increased smartphone penetration. Verizon Wireless launched 4G LTE services in December 2010 and began distribution of the iPhone on its network in February 2011.

Generate liquidity or free cash flow from non-controlled interests

Non-controlled interests constitute around 40% (based on third party estimates) of the value of the Group’s assets. We aim to maximise the value of these interests either by generating liquidity or increasing free cash flow in order to fund profitable investment and enhance shareholder returns.

Verizon Wireless

Verizon Wireless is our largest non-controlled interest, in which we have an equity interest of 45%. It is the revenue market leader in the US and performed strongly this year with service revenue growth of 5.8%(*). To create additional value we are working closely with Verizon Wireless on several initiatives that leverage our combined scale and scope including purchasing of network equipment, IT and services, technology enhancements and propositions for multinational companies. We received around £1.0 billion in dividends this year, in relation to tax related dividend receipts (see “Dividends from associates and to non-controlling shareholders” for further information), which was substantially less than our proportionate share of Verizon Wireless’ free cash flow which shows the material opportunity for incremental returns.


Polkomtel trades as Plus in Poland and is a leading operator in Poland. Along with the four other owners we are exploring options for a sale of the business.

Bharti Airtel

Bharti is the market leader in India. Following the purchase of our controlling interest in Vodafone Essar in India in 2007, we sold 5.6% of our stake in Bharti in 2008 and retained a 4.4% indirect interest.

Sale of interests

In September 2010 we sold our 3.2% interest in China Mobile Limited for £4.3 billion. In November 2010 we sold our interests in SoftBank of Japan for £3.1 billion and approximately half of the proceeds have been received to date and used to reduce the Group’s net debt. The remaining proceeds are expected to be received in April 2012. In April 2011 we announced the sale of our 44% interest in SFR, the second largest mobile operator in France, for £6.8 billion. The transaction, which is subject to competition authority and regulatory approvals, is expected to complete during the second calendar quarter of 2011.

Proceeds from the sale of all of these interests are being used to reduce net debt and committed to a £6.8 billion buyback of our shares of which £2.6 billion has been completed to date.

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