Vodafone is in the final stages of completing a deal worth nearly $30 billion (£15.5 billion) that will see it overtake AT&T to become the biggest mobile phone company in America.

Executives from Vodafone and Verizon, the US phone company in which the Berkshire-based group controls a 45 per cent stake, are understood to be in advanced discussions with Alltel, America’s fifth-biggest cell phone operator.

The transformational deal would represent the swansong of Arun Sarin, the chief executive of Vodafone, who is planning to step down this summer.

While it is thought that Verizon and Vodafone have valued Alltel at about $27 billion, most of the consideration of that sum would be made up of the Arkansas company’s existing debt. Any deal between the parties would involve a significant amount of Alltel’s borrowings being transferred on to the Verizon balance sheet, which shows little debt.

Verizon and Vodafone executives are negotiating with Alltel’s new owners — TPG and Goldman Sachs Capital Partners — the two private equity firms who acquired the group only in November. Verizon and Vodafone would have to convince both the private equity firms and Citigroup, Barclays and Royal Bank of Scotland, who helped to fund the acquisition of Alltel last year for $24.7 billion.

A combined Verizon-Alltel group would have about 80 million mobile phone subscribers across the United States and would make the new operator larger than AT&T, the largest US mobile phone network with about 71 million subscribers. Alltel has about 11 million customers across 34 states.

Last month Alltel said that during the first quarter of the year revenues had risen by 11 per cent to $2.3 billion and there had been a 26 per cent rise in subscribers compared with the same period the year before.

It is not known whether AT&T will seek to gatecrash the talks and try to make an offer of its own for Alltel. However, any deal between AT&T and Alltel would attract more regulatory obstacles. Should Verizon manage to secure a deal to buy Alltel, any transaction would have to be approved by both the US Department of Justice and the Federal Communications Commission.

Alltel is attractive to Verizon and Vodafone for a number of reasons. While the additional scale and increased subscriber base would help the combined group to sell more services to more users, Verizon would also be able to strip out costs from where the two businesses overlap.

Christopher King, a telecoms analyst at Stifel Nicolaus, said that he believed such a deal would have “compelling drivers” for Verizon. He added that it was not unrealistic to assume that Verizon could achieve $1 billion in annual cost synergies from buying Alltel and that the rural carrier was a “very well-run business”, with solid wireless subscriber numbers. Mr King explained that Verizon could easily afford the deal, given its “quite healthy” balance sheet. He said that it was unclear whether Vodafone would contribute to the deal.

Verizon declined to comment and Vodafone and Alltel failed to return calls.

On Wall Street yesterday, shares in Verizon fell 1 per cent to $36.98. In London, shares in Vodafone closed down 5 per cent at £154.65. The Vodafone share movement came before news of the talks was made public.

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