Vodafone owns a 45% stake in Verizon Wireless, a fast-growing network operator with 50m subscribers, but has no management control. Verizon has stopped paying it dividends and uses a different brand and network technology.

Some of Vodafone’s biggest shareholders, frustrated by its weak share price, believe that the capital tied up in Verizon should be returned to them. They argue that this would transform Vodafone’s financial profile, and prompt a big jump in its share price. Its biggest shareholders include Capital Research & Management, M&G, Morley, Standard Life and Scottish Widows.

One top shareholder said: “I would be surprised if you could find anyone among the top 10 shareholders who does not want them to sell the US [interests] and give the money back.

There will be a lot of pressure by the time of the results [in May]. We’re going to drift into an area where people expect a change in strategy.”
Selling Verizon would mean Vodafone abandoning its ambition to be the world’s leading cellular company — “the Coca-Cola of mobile”.

Years of poor stock-market performance have undermined investor confidence in the strategy dubbed “bigger is better” by critics. Doubts have grown since a profit warning last November, which highlighted the group’s problems in Japan and the margin squeeze on its mature European operations.

Vodafone said it would be wrong to sell Verizon when it was still growing strongly in a country where mobile usage remains under 70%, and Verizon also stood to benefit from market consolidation that has reduced the number of national mobile carriers from six to four in the past two years.

But investors complain they are receiving no benefit from the growing value of the American business. Some believe Vodafone should capitalise on the high price that Verizon Wireless would fetch, and sell its minority stake to its joint- venture partner, Verizon Communications.

One analyst said a buyback of shares funded by the American disposal could justify a valuation of 170p — far above the 118p at which trading closed on Friday.

Vodafone, along with Telefonica and T-Mobile, appears to have ruled itself out of the bidding for Millicom International Cellular, the mobile firm put on sale last week which operates in 16 African, Asian and Latin American countries.

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