Vodafone confirms consolidation talks with European rivals | Vodafone
Vodafone’s chief executive has confirmed it is in talks with rivals in its biggest markets to strike deals with ‘speed and determination’ as the telecoms company seeks to heed calls for a business reshuffle from the new investor Cevian activist.
Nick Read, who has argued that the European telecoms industry must consolidate to create more profitable businesses that are more attractive to investors, confirmed that the mobile operator was looking to competitors in the UK, in Germany, Italy and Spain.
The chief executive has struck 19 deals since his appointment three years ago, a pace he said he intended to maintain, in his first comments since Europe’s biggest activist shareholder was revealed taking a stake in Vodafone.
“There has been speculation in the media about merger and acquisition activity in specific European markets,” Read said. “We believe the UK needs to consolidate to give [us] on an industrial scale to improve yields.
“We are active on multiple fronts and are seeing good engagement from our counterparties, confirming that we have a range of potential opportunities to shape the business with stronger assets in healthier markets and free up value for our shareholders. We are approaching consolidation with speed and determination.”
Vodafone has been linked with a range of potential deals, including a takeover or merger with Three UK as well as counterparts in Germany, Spain and Italy.
“I look at the markets where I see a strong case for consolidation without the need for punitive remedies, those markets [are] Spain, Italy, UK and now Portugal. These four markets are the biggest opportunity with a good and solid rationale,” he said. “We work with multiple parties in multiple markets. We will remain open-minded and pragmatic to seize opportunities at our own pace.
Vodafone also controls 82% of Vantage Towers, its European mobile tower network launched last year, which Read said was in talks with similar ventures owned by Germany’s Deutsche Telekom and France’s Orange.
“Putting this combination together would make a European champion in the rounds. This would support the infrastructure of the digital decade that Europe wants to achieve,” he said.
Sweden-headquartered Cevian, known for taking longer-term positions to turn around businesses without taking aggressive action, is looking to shore up Vodafone’s sprawling £34billion empire to focus on its toughest markets. more profitable and inject more telecommunications experience at the board level.
“We don’t comment on who’s on our share register if it’s not at a disclosable level,” he said. “But we have a regular dialogue with our large and small shareholders. I looked at the speculations [about what Cevian wants]for me, everyone confirms that we are doing the right things.
Vodafone shares rose nearly 3% in early trading on Wednesday as investors warmed to the company’s generally positive results, in which the company added 152,000 UK customers and reached nearly one million fixed broadband customers, as its business benefited from Black Friday and the power of the iPhone. Sales.
The company will benefit from an increase in revenue this year thanks to the return of roaming charges for UK travelers to Europe.