UAE telecoms group confirms £3.3bn raid on Vodafone
A Middle Eastern telecoms group has taken a near-10% stake in Vodafone as the UK mobile phone company comes under pressure for a business shake-up.
The state-controlled Emirates Telecommunications Group, which recently rebranded from Etisalat to e&, is now Vodafone’s biggest shareholder after confirming a £3.3bn raid on the UK group on Saturday.
E& said it had made the investment “to gain significant exposure to a world leader in connectivity and digital services” and did not intend to launch a takeover bid, a statement which blocks the company from making such a move for at least six months.
Vodafone claims on its website to supply government departments including the Ministry of Justice, meaning any new owner would have to be carefully vetted.
The Abu Dhabi-based group, which has created a special holding company, Atlas 2022, to control the Vodafone stake, said it planned to be a “long-term and supportive shareholder in Vodafone and is not seeking to exert control or influence the company’s board or management team”.
Vodafone’s chief executive, Nick Read, is under pressure to simplify sell off subsidiaries and improve returns after a more than 20% slide in its share price since he took over in 2018.
E&’s involvement comes after Vodafone revealed that it was in talks with rivals in the UK, Spain, Germany and Italy, in an apparent response to pressure from Cevian, Europe’s largest activist investor, which took a stake in Vodafone and called for a business shake-up.
Cevian, which is headquartered in Sweden and is known for taking longer-term positions to turn around businesses without taking aggressive action, is seeking a consolidation of Vodafone’s sprawling empire to focus on its most profitable markets and inject more
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