Verizon Communications has agreed to buy Vodafone’s share of its US mobile phone business for $130 billion (£83.7 billion). The deal will involve Verizon acquiring Vodafone’s US business - which owns 45% of Verizon Wireless - for $58.9 billion cash and most of the remainder in stock. As a result, Verizon will gain complete ownership of the wireless business that bears its name.

This agreement is expected to be completed in early 2014, subject to the approval of regulators and shareholders.

Vodafone shareholders are expected to receive all the Verizon shares and $23.9 billion of cash - a total of $84 billion - which is equivalent to £1.12 per share.

Lowell McAdam, Verizon chairman and CEO, said “Over the past 13 years, Verizon Wireless has been a key driver of our business strategy, and through our partnership with Vodafone, we have made Verizon Wireless into the premier wireless provider in the US. The capabilities to wirelessly stream video and broadband in 4G LTE complement our other assets in fiber, global IP and cloud. These assets position us for the rapidly increasing customer demand for video, machine to machine and big data. We are confident of further growth in wireless, and our business in its entirety. This transaction will enhance value across platforms and allow Verizon to operate more efficiently, so we can continue to focus on producing more seamless and integrated products and solutions for our customers. We believe full ownership will provide increased opportunities in the enterprise and consumer wireline markets. Verizon Wireless is the greatest wireless company in the world, and a big part of this success was due to the hard work of both partners, Vodafone and Verizon. The timing was right to execute a transaction that benefits both companies and their shareholders. Today’s announcement is a major milestone for Verizon, and we look forward to having full ownership of the industry leader in network performance, profitability and cash flow.”

Vittorio Colao, CEO of Vodafone Group, said “We are pleased that our long and successful partnership with Verizon will yield a significant return of value to our shareholders, rewarding them for their continuing support of Vodafone’s investment strategy, and we wish Lowell and the Verizon team continuing success over the years ahead. As a result of the transactions, we will also greatly enhance Vodafone’s long-term prospects through ‘Project Spring’, our new programme of additional organic investments in 4G, 3G, fibre and broadband, enterprise services and improved customer experience across all of our markets. Project Spring will strengthen and accelerate our existing Vodafone 2015 strategy, enabling us to take even greater advantage of the growing global demand for ubiquitous high-speed data. This will in turn underpin our intention to grow the dividend per share annually, in line with our track record of providing shareholders with sustainable and high quality returns.”

Verizon Wireless was founded in 2000 as a joint venture of Verizon and Vodafone. It has over 100 million retail connections and 73,400 employees.