On Wednesday, Vodafone’s Chief Financial Officer, Andy Halford reported that Vodafone could receive an amount of $5.5bn from its 45% stake in Verizon Wireless annually starting from next year. This estimate is totally based on the $1bn-a-month or $12bn-a-year free cash flow that Verizon Wireless generates. The cash has to be mainly used to pay down the company’s debt.

In 2005, Verizon Wireless, which is the largest US mobile operator have stopped paying a dividend to the firms Verizon Communications and Vodafone.

It was observed that Vodafone has generated £7.1bn of free chase flow in the year until March 31, 2011. Therefore, a Verizon Wireless has a dividend worth $5.5bn would increase the Vodafone’s free cash flow by almost 50% and therefore, should be increase in returns to the UK mobile operator’s shareholders.

It was also noted that Vodafone has just completed the sale of its 44 per cent holding in SFR, the French mobile operator, to Vivendi and is pursuing to a disposal of its 24% stake in Polish mobile-phone operator Polkomtel.

Mr. Halford told the reporters during a visit to India that this would be the first time that Vodafone has publicly indicated what size of pay-out it is expecting and the two companies have been negotiating over the dividend since last year and no agreement has been reached till yet.