Chief executive Vittorio Colao is closing in on a sale of Vodafone’s 45pc stake in Verizon Wireless, the US’s biggest mobile operator, to majority owner Verizon Communications.
The company expects tax exemptions to allow it to keep the vast majority of the income which will be positive news for investors, including UK pension funds, which are expecting a major payout following the deal.
People (including some very savvy investors) keep talking about the tax that will be due on this.
But there’s no tax payable on selling such a stake in a subsidiary. Substantial shareholding exemption or SSE. From the UK point of view there’s just not anything to pay at all.
The Americans might want a slice but that should be simple enough to deal with.
I just don’t get it. What tax is it that everyone’s worrying about?
Note that this piece in the Telegraph does talk about this. But what’s confusing me is why anyone ever thought it was going to be different?