Vodafone Group PLC (VOD)

[idpickering]

Sale of Vodafone Spain.

Vodafone Group Plc ("Vodafone") announces that it has entered into binding agreements with Zegona Communications plc ("Zegona")1 in relation to the sale of 100% of Vodafone Holdings Europe, S.L.U. ("Vodafone Spain") (the "Transaction").

· On completion, Vodafone's consideration will comprise at least €4.1 billion in cash and up to €0.9 billion in the form of Redeemable Preference Shares ("RPS") which redeem, for an amount comprising the subscription price and accrued preferential dividend, no later than 6 years after closing

· Vodafone and Zegona have entered into an agreement whereby Vodafone will provide certain services to Vodafone Spain for a total annual service charge of c.€110 million2

· The enterprise value of €5.0 billion is equivalent to a multiple of 5.3x Adjusted EBITDAaL3 and 12.7x OpFCF4 for the 12-month period ended 31 March 2023

Margherita Della Valle, Chief Executive of Vodafone, said:

"The sale of Vodafone Spain is a key step in right-sizing our portfolio for growth and will enable us to focus our resources in markets with sustainable structures and sufficient local scale. I would like to thank our entire team in Spain for their dedication to our customers and relentless determination to improve our organic performance. However, the market has been challenging with structurally low returns.

My priority is to create value through growth and improved returns. Following the recently announced transaction in the UK, Spain is the second of our larger markets in Europe where we are taking action to improve the Group's competitiveness and growth prospects."

https://www.investegate.co.uk/announcem ... in/7849036

Ian (No holding).

[idpickering]

Strategic Partnership with Accenture.

Vodafone Group Plc ("Vodafone") announced today its intention to create a strategic partnership with Accenture to commercialise Vodafone's shared operations to accelerate growth, enhance customer service and drive significant efficiencies for Vodafone's operating companies and partner markets, as well as create new career opportunities for its people.

The strategic partnership will build on Vodafone's market leading shared services unit, Vodafone Intelligent Solutions (_VOIS), to create a scaled, commercially driven and more efficient organisation with high quality services and enhanced speed to market for its portfolio of offerings. Under this new model for the industry, Vodafone will retain majority interest, management control and sourcing decisions.

The new unit will utilise Accenture's world class technology and transformation services such as its digital solutions and platforms, and deep AI expertise. It will also tap into Accenture's well-known learning capabilities to continuously create new skilling and career paths for its people. Accenture will invest in the order of €150m for a minority stake in the partnership.

"Today's announcement is a significant development for Vodafone as we change and simplify the way we work to better serve our customers and drive growth," said Margherita Della Valle, Group CEO, Vodafone. "The partnership with Accenture opens up new opportunities for our company and our people. We're excited about the potential of our new commercial shared services organisation and the potential to serve not only Vodafone's own markets but our Telco partners across the industry."

https://www.investegate.co.uk/announcem ... re/7876260

Ian (I hold).

[Bouleversee]

Thanks, Ian. I, too, hold, unfortunately, and am making a large loss. Hope this deal revives it but don't feel inclined to throw any more money in that direction.

[idpickering]

Thanks, Ian. I, too, hold, unfortunately, and am making a large loss. Hope this deal revives it but don't feel inclined to throw any more money in that direction.

You're welcome Lorna, and I hope you're well. I actually dumped my VOD holdings some time ago, at a loss. I swore I'd never hold them again, but I'm impressed with the new CEO and thought I'd give her a chance at least, and bought back into VOD.

All the best,

Ian.

[daveh]

VOD are due to report interims tomorrow. They have sat at the top of my HYPTUSS for a long while now, but I'll wait to see what tomorrows results bring before I think of buying more. There are worries on the dividend being unsustainable (so it may get cut tomorrow), and I'll be interested to see what has/is happening with debt levels. They should be falling with the sale of companies that Vodafone has decided are surplus to requirements as part of its business simplification and concentration on markets where its the dominate supplier.

[ReformedCharacter]

VOD are due to report interims tomorrow. They have sat at the top of my HYPTUSS for a long while now, but I'll wait to see what tomorrows results bring before I think of buying more. There are worries on the dividend being unsustainable (so it may get cut tomorrow), and I'll be interested to see what has/is happening with debt levels. They should be falling with the sale of companies that Vodafone has decided are surplus to requirements as part of its business simplification and concentration on markets where its the dominate supplier.

Although I'm generally a 'buy and hold' investor, I do make the odd exception and sold my VOD a couple of weeks ago, I haven't bothered to check the loss which will be considerable. I should have sold after they sold Verizon, easy with hindsight of course. It was the question of the sustainability of the dividend which overcame my inertia.

RC

[idpickering]

H1 FY24 results.

Margherita Della Valle, Group Chief Executive, commented:

"During the first half of the year, we have delivered improved revenue growth in nearly all of our markets and have returned to growth in Germany in the second quarter.

Vodafone's transformation is progressing. Our focus on customers and simplifying our business is beginning to bear fruit, although much more needs to be done. We have also announced transactions to strengthen our position in the UK and exit the challenging Spanish market in order to right-size our portfolio for growth."

And later;

Dividends

Dividends will continue to be declared in euros, aligning the Group's shareholder returns with the primary currency in which we generate free cash flow, and paid in euros, pounds sterling and US dollars. The foreign exchange rate at which future dividends declared in euros will be converted into pounds sterling and US dollars will be calculated based on the average World Markets Company benchmark rates over the five business days during the week prior to the payment of the dividend.

The Board has announced an interim dividend per share of 4.50 eurocents (H1 FY23: 4.50 eurocents).

The ex-dividend date for the interim dividend is 23 November 2023 for ordinary shareholders, the record date is 24 November 2023 and the dividend is payable on 2 February 2024. Dividend payments on ordinary shares will be paid directly into a nominated bank or building society account.

https://www.investegate.co.uk/announcem ... rt/7878891

Ian (I hold).

[idpickering]

Swisscom’s Fastweb Is Said to Explore Deal for Vodafone Italy.

Italian telecom operator Fastweb is exploring a potential deal for Vodafone Group Plc’s Italian operations, according to people with knowledge of the matter.

https://finance.yahoo.com/news/swisscom ... 06879.html

Ian.

[idpickering]

The iliad Group submits proposal to Vodafone to join forces in Italy

The iliad Group has submitted to Vodafone Group a proposal for the merger of iliad Italia and Vodafone Italia

Proposal values Vodafone Italia at €10.45 billion (EV). Vodafone would obtain 50% of the share capital of NewCo, together with a €6.5 billion cash payment and a €2.0 billion shareholder loan to ensure long-term alignment. Vodafone’s equity in NewCo at closing valued at €1.95 billion

https://www.globenewswire.com/news-rele ... experience.

Ian.

[idpickering]

The iliad Group submits proposal to Vodafone to join forces in Italy

The iliad Group has submitted to Vodafone Group a proposal for the merger of iliad Italia and Vodafone Italia

Proposal values Vodafone Italia at €10.45 billion (EV). Vodafone would obtain 50% of the share capital of NewCo, together with a €6.5 billion cash payment and a €2.0 billion shareholder loan to ensure long-term alignment. Vodafone’s equity in NewCo at closing valued at €1.95 billion

https://www.globenewswire.com/news-rele ... experience.

Ian.

The above news seems to have been well received, what with VOD being up 6.8% as I type. I'm still not tempted to buy back into VOD though to be honest.

Ian.

[daveh]

and here is Vods take on it:
https://www.investegate.co.uk/announcem ... ly/7948503

HIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

Statement on Iliad announcement relating to Italy

Vodafone Group Plc ("Vodafone") notes today's announcement from Iliad regarding a proposed merger of Vodafone Italy and Iliad Italy.

Consistent with its previous statements, Vodafone is supportive of in-market consolidation in countries where it is not achieving appropriate returns on invested capital and confirms it is exploring options with several parties to achieve this in Italy, including through a merger or a disposal.

There can be no certainty that any transaction will ultimately be agreed. If required, a further announcement will be made when appropriate.

[idpickering]

Vodafone and Microsoft Partnership

Vodafone and Microsoft Corp. on Tuesday announced a new, far-reaching 10-year strategic partnership that leverages their respective strengths in offering scaled digital platforms to more than 300 million businesses, public sector organisations, and consumers across Europe and Africa.

Through the partnership, the companies will collaborate to transform Vodafone's customer experience using Microsoft's generative AI, hyperscale Vodafone's leading managed IoT connectivity platform, develop new digital and financial services for businesses, particularly SMEs across Europe and Africa, and overhaul its global data centre cloud strategy.

Vodafone will invest $1.5 billion over the next 10 years in cloud and customer-focused AI services developed in conjunction with Microsoft. Additionally, Microsoft will use Vodafone's fixed and mobile connectivity services.

https://www.investegate.co.uk/announcem ... ip/7990483

Ian (No holding in either stock).

[idpickering]

Competition watchdog launches formal probe of Vodafone and Three tie-up

The Competition and Markets Authority (CMA) has launched a formal investigation into the merger of Vodafone and Three.

Back last June, Vodafone and CK Hutchinson, owner of Three, announced their long-awaited UK £15bn merger. The deal would combine the companies’ telecommunications operations under one single network provider.

The CMA today has started its Phase 1 investigation into the joint venture agreement as the CMA assess how this tie-up between rival networks could impact competition before deciding next steps.

Some commentators have suggested this merger presents a potential risk to the UK’s national security as CK Hutchison Holdings is based in Chinese-controlled Hong Kong.

Speaking on this to City A.M., Ahmed Essam, chief executive officer of Vodafone UK explained: “This is a very simplistic analysis. We already thoroughly protect the data of our customers big and small with strict security protocols. If we didn’t, our customers – some of which are big Government departments involved in national security – wouldn’t trust us to be their technology partner.”

“But they do, and we don’t win these contracts without being subjected to strict security vetting procedures, as is only right.”

https://uk.finance.yahoo.com/news/compe ... 16459.html

VOD are up over 2% as I type.

Ian (No holding in either firms).

[idpickering]

Vodafone fails to accept revised iliad Group’s proposal to merge Italian businesses

Following Iliad’s offer dated 18 December 2023, the iliad Group submitted a further, revised proposal to Vodafone Group for the merger of iliad Italia and Vodafone Italia in a new entity (“NewCo”) in order to create the most innovative telecom challenger for Italy. Vodafone Group has failed to accept this offer.

https://www.globenewswire.com/news-rele ... is%20offer.

Ian (No holding of either share).

[tjh290633]

I see the sterling value of the dividend payable on 2nd feb is 3.84525p/share.

https://investors.vodafone.com/individu ... /dividends

TJH

[idpickering]

Vodafone Q3 FY24 Trading Update

Sustained revenue growth in Europe & Africa

Margherita Della Valle, Vodafone Group Chief Executive, commented:

"We maintained good service revenue momentum in the third quarter across both Europe and Africa, supported by a further acceleration of Vodafone Business, with our Cloud and Internet of Things services growing over 20%.

We've made good strategic progress in the first nine months of the year, with improving customer satisfaction and three consecutive quarters of service revenue growth in Europe. Our announced transactions in the UK and Spain are progressing well, and we are in active discussions in Italy. We've also begun strategic partnerships with Microsoft and Accenture to fast-track our transformation."

https://www.investegate.co.uk/announcem ... te/8020794

Ian (No holding).

[idpickering]

Update regarding Vodafone Italy

Vodafone Group Plc (“Vodafone”) notes recent media speculation and confirms it is in exclusive discussions with Swisscom AG (“Swisscom”) regarding a potential sale of Vodafone Italy to Swisscom for cash.

Subject to confirming binding transaction documentation, the parties have agreed that Swisscom will acquire Vodafone Italy for an enterprise value of €8 billion on a debt and cash free basis and subject to customary closing adjustments. The enterprise value represents a multiple of c.26x consensus FY24F OpFCF1 and c.7.6x consensus FY24F Adjusted EBITDAaL1.

Vodafone has engaged extensively with several parties to explore market consolidation in Italy and believes this potential transaction delivers the best combination of value creation, upfront cash proceeds and transaction certainty for Vodafone shareholders.

There can be no certainty that any transaction will ultimately be agreed. If required, a further announcement will be made when appropriate.

https://www.investegate.co.uk/announcem ... ly/8059890

Ian (No holding).

[idpickering]

Sale of Vodafone Italy and capital return

Reshaped European footprint, €8bn sale of Vodafone Italy & €4bn capital return

Vodafone Group Plc ("Vodafone") announces today the final step of the portfolio right-sizing announced in May 2023, with a binding agreement to sell 100% of its Italian operations ("Vodafone Italy") to Swisscom AG ("Swisscom") (the "Transaction").1

· Reshaped European footprint focused on growing markets, with strong positions and local scale

· Value-creating sale of Vodafone Italy to Swisscom for €8 billion upfront cash proceeds

· Attractive valuation, representing c.26x consensus OpFCF2 and 7.6x consensus Adjusted EBITDAaL2 for FY24

· New capital allocation framework, including dividend to be rebased to 4.5c per share from FY25 onwards, €4 billion capital return via share buybacks and new leverage range of 2.25x - 2.75x

"Today, I am announcing the third and final step in the reshaping of our European operations. Going forward, our businesses will be operating in growing telco markets - where we hold strong positions - enabling us to deliver predictable, stronger growth in Europe. This will be coupled with our acceleration in B2B, as we continue to take share in an expanding digital services market.

The sale of Vodafone Italy to Swisscom creates significant value for Vodafone and ensures the business maintains its leading position in Italy, which has been built through the dedicated commitment of our colleagues to serving our customers over many years.

Our transactions in Italy and Spain will deliver €12 billion of upfront cash proceeds and we intend to return €4 billion to shareholders via buybacks, as part of our broader capital allocation review."

Margherita Della Valle
Group Chief Executive

https://www.investegate.co.uk/announcem ... rn/8089340

Ian (No holding).

[idpickering]

Vodafone-Three merger: Proposed deal could lead to higher prices, says watchdog.

The proposed merger between mobile networks Vodafone and Three could lead to “higher prices” and “reduced quality” for customers, the competition watchdog has warned.

https://www.msn.com/en-gb/money/other/v ... r-BB1kl2Gp

Ian.

[idpickering]

Vodafone Business CEO Appointed.

Vodafone today announced that Marika Auramo has been appointed CEO of Vodafone Business, with effect from 1 July 2024. She will also become a member of Vodafone's Executive Committee from the same date. Marika is a highly respected business leader and has more than 25 years' experience in the global IT industry.

https://www.investegate.co.uk/announcem ... ed/8138857

Ian (No holding).