It's not often Wall Street shrugged four months 30% of assets prices.
130 billion, up from $ 10 billion U.S. dollars of the price range, it is being considered in April .
Verizon's share price closed up 2.7 percent on Thursday as investors in the company's prospects strode to tens of billions of dollars in debt , so that trading capital .
Over the years , Verizon has made ??no secret of its ambition to have all the Verizon Wireless - America's top mobile service providers - because it has the best customer growth rate and profitability of any telecommunications company in the country . It has not been concerned about wasting money , it has a way to get control of the asset .
Analysts believe that the three big motivating factor to support transactions: rising interest rates , increased competition and rapid Verizon's stock price down 12% since April .
If these trends continue, analysts expect them to reach into an agreement to become more expensive for Verizon to pull off .
"With interest rates rising , Verizon and Vodafone are aware of the fact that they have a narrow window to complete the deal , " New Street analyst Jonathan Chaplin said.
Vodafone has confirmed it is in talks with Verizon , but declined to give further details. Verizon has declined to comment .
U.S. Federal Reserve Board has said it expects to begin final practice next year and reduce its monthly purchases of government mortgage-backed debt . Expectations, this policy shift that could have been lifted long-term interest rates as soon as September .
In this interest rate environment, have reached an agreement for the Verizon Verizon Wireless will wait longer to become more expensive. , Verizon can expect to pay the company has to pay hundreds of millions of dollars per annum today , it will pay more than expected in April .
The benchmark 10 -year U.S. Treasury yields increased by about 1 percentage point to 2.76 percent .
Seem worth the steep price
Even with the higher interest costs , Macquarie analyst Kevin Smithen estimates , Verizon Wireless is still likely to increase the purchase of the rest of Verizon's 2014 earnings per share of 14.7%. However, if Verizon has made ??$ 13 billion U.S. dollars deal, earlier this year , when its share price is higher, and lower interest rates , this increase would have been more like 21.8 percent , according to Smithen.
Smithen, said: "" If the price is the only sticking point , we do not know why Verizon did not pull the trigger.
Verizon Wireless customers' growth and profitability , and is currently leading the U.S. package , requires a new approach to slowing growth for the U.S. market , as most people already own a smartphone , rapidly increasing competition .
Reported net subscriber growth in the second quarter, thanks in part to aggressive marketing , the fourth largest U.S. mobile operator T-Mobile USA (TMUS.N) began Verizon Wireless and other competitors after years of losses. Sprint Corporation (SN) is also expected to be a tough opponent, as it strengthens its network and now has the majority owner of Softbank (9984.T) support.
"Verizon 's want to have total control of the asset , especially since we are entering a more competitive environment , said:" Standard & Poor's analyst James Moorman . " " When you look at the value of the assets is justified house. "
Nevertheless, such a deal is not without risk , because it would saddle Verizon's heavy debt burden , can match its cash flow . Craig Moffett Moffett 's research is such a great deal of time in the U.S. wireless market growth is slowing advantage of more hesitant .
Because the United States has been the world's best wireless growth markets in the world , Verizon has been in a leading position , it is unlikely to face more to improve its business , he said.
Moffett said : "There are more important things better for the Verizon Wireless and meaningful opportunities to further deterioration in the situation is unlikely ."
Swallowing such a high price tag disadvantage , Verizon in the upcoming spectrum auction bidding , leaving the coast clear competitors such as AT & T Inc. (TN) pointed out that the New Street Chaplin , it may be very difficult .
But he said investors may still prefer to see Verizon's purchase of the " best assets in worldwide telecommunications ."
"It 's worth $ 13 billion U.S. dollars , " he said.
Analysts also pointed out that , Verizon Wireless Verizon full ownership will improve cash flow , without making any strategic change .
With Verizon Wireless' free cash flow of 28.6 one billion U.S. dollars last year , RBC Capital Markets , said the analyst Doug Colandrea , Verizon companies have the ability to repay the debt " very quickly ."



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