Verizon CFO Doesn't See Vodafone Deal In Near Term

It's unlikely that Verizon Communications will buy out Vodafone Group's stake in its U.S. wireless business, Verizon Chief Financial Officer Doreen Toben said Tuesday.

Analysts' estimates over the value of Verizon Wireless, the No. 2 wireless carrier in the U.S., are well above the premium, she said during an analyst conference hosted by Morgan Stanley in Washington, which was Webcast.

Verizon has openly expressed its interest in buying out Vodafone's 45% stake in the joint venture. But Toben said Verizon would be "willing to consider paying what we reflect is the fair value."

"Vodafone knows where we stand," she said, declining to comment further on the level of discussions held.

Toben said she looks at what Verizon Wireless is worth, factoring in its multiples during the next few years and determining whether the acquisition would add to earnings in the first year.

Various media reports, mainly through the U.K., have had bids ranging from $38 billion to $50 billion coming out of Verizon for the stake. In the past, Verizon has been a shrewd acquirer, unwilling to overpay for an acquisition.

On Verizon's high-speed Internet business, Toben said she doesn't expect to lower the price of its digital subscriber line, or DSL, service. It currently costs as little as $15 a month.

"There's enough discrepancy between us and cable," she said.

The lower price point has won over dial-up customers. Once the customers have switched over, their retention rates improve, she added.

Like the other phone companies, Verizon continues to lose access lines. Those losses could widen this year, Toben said, although she declined to be more specific. There likely won't be a point where the phone companies start to add access lines. Instead, Verizon is focused more on metrics such as average revenue per user, she said.

-By Roger Cheng, Dow Jones Newswires; 201-938-2020; roger.cheng@dowjones.com

(END) Dow Jones Newswires "

Posted to the site on 23rd May 2006