Verizon Fixed-Line Sale Would Enable Vodafone Combination, Goldman Says

A disposal of Verizon Communications’ fixed-line operations would clear the way for the company to merge its wireless and enterprise units with partner Vodafone Group Plc, analysts at Goldman Sachs Group said.

An agreement on a frequency purchase and marketing cooperation that Verizon’s mobile-phone unit reached in December with U.S. cable operators led by Comcast would make separating its divisions easier, the analysts, including Tim Boddy in London, wrote in a research report. Verizon Chief Financial Officer Fran Shammo said in November that the two carriers were moving from a financial partnership to a strategic relationship. The companies will focus on joint purchasing and service agreements for their business customers in the short term, the Goldman Sachs analysts said. “Given that it no longer faces the threat of integrated cable competitors, Verizon could potentially spin off its remaining Consumer Wireline assets,” along with “large” pension and benefit liabilities, the Goldman analysts said.