Niel plans no takeover offer for Vodafone as buys 16% stake from e&
Telecom industry investor Xavier Niel on Thursday said a family-own investment vehicle has agreed to buy the entire stake in Vodafone Group PLC held by Emirates Telecommunications Group Co PJSC, known as e&, making Niel the largest shareholder in the UK-based telecom service provider.
Niel said it has no intention to make a takeover offer for Vodafone following the £4.36 billion purchase of the 16.2% e& stake, which carries 17.1% voting rights. Niel's acquisition vehicle Vega will buy 3.94 billion Vodafone shares from e& at a price of £1.10 per share.
Vodafone shares were up 10% to 108.00 pence early Friday in London following the announcement. The company has a £24.88 billion market capitalisation.
Berkshire, England-based Vodafone noted the announcement, saying only that its relationship agreement with e& has been terminated as a result. Hatem Dowidar, who represented e& on the Vodafone board, has resigned immediately, it said.
Niel said Vega will contact the UK government about the investment and "work constructively with the relevant authorities throughout the process".
The investment in Vodafone "is intended to be a long-term, strategic minority shareholding", Vega said.
"Vodafone is ready for a new phase of growth and is well-placed to unlock substantial untapped value across its European and African operations," Xavier Niel said.
"We are confident Vodafone can deliver sustainable growth and strong cash flow generation over the long term and – as an anchor investor based in Europe – we are ready to contribute our deep sector expertise and operational know-how to its future success."
The Niel family group describes itself as "the number 1 private investor in the telecoms sector in Europe", with stakes in providers such as iliad, Salt, Monaco Telecom, Eir, Tele2 and Millicom. Together its telecom assets generate EUR24 billion in annual revenue and operate in 26 countries in Europe and Latin America.
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