The CEO of Verizon, which owns 60% of the US’ largest mobile operator Verizon Wireless, has implied that the unit’s IPO may not take place when expected. It no longer needs to raise $8 billion to buy new spectrum, so some of the rationale for the IPO has disappeared.
The results of last year’s US wireless spectrum auction are now on hold, after the courts ruled it illegal. As a result, Verizon Wireless does not need the $8 billion it had planned to spend on spectrum. Verizon CEO Ivan Seidenberg has told investors, In the long term the idea of a separate stock for that business is probably still a good idea, but we are in no rush to move it forward.
Verizon Wireless’ IPO has already been postponed once: it was originally scheduled for early 2001, but was cancelled after wireless company shares crashed last year. The continuing poor performance of telecoms shares is likely to be another factor in Verizon’s decision.