Vodafone Chief Is Open to His ‘Beautiful Assets’ Being Eyed
Vodafone Group Plc (VOD), set to receive $130 billion for exiting the U.S., will focus on expanding wireless networks even as potential buyers may be sizing up the company for a bid, Chief Executive Officer Vittorio Colao said.
“We have a strategy and we are putting a lot of money into it, but if somebody comes and says, ‘You have really beautiful assets,’ then I will agree,” Colao said yesterday at an investor conference in Barcelona. “We have beautiful assets.”
AT&T Inc. (T) executives are laying the groundwork internally for a potential acquisition of Vodafone next year, people with knowledge of the matter told Bloomberg News this month. A takeover of Vodafone would give the second-largest U.S. wireless carrier a foothold in Europe as demand increases for faster, fourth-generation services.
Vodafone is spending 7 billion pounds ($11.3 billion) through March 2016 on network upgrades, spreading 4G service across Europe and building high-speed landline and mobile networks in emerging markets such as South Africa.
Europe’s largest mobile operator also plans to cover the region with so-called converged services -- of television, Internet and telephone -- in the next five years, Colao said. The Newbury, England-based company will offer the services through a mix of acquisitions, network buildouts and partnerships, he said at the conference organized by Morgan Stanley.
Vodafone gained less than 1 percent to 228.20 pence at 8:50 a.m. in London. The shares have gained 47 percent this year.
Vodafone is set to receive $130 billion for selling its stake in the Verizon Wireless venture to Verizon Communications Inc. Verizon shareholders will probably vote on the deal in January, Chief Financial Officer Fran Shammo said at the event yesterday.
Vodafone’s Spanish market, which has suffered from heavy competition and a sluggish economy, may have hit bottom and is starting to see some “very early signs” of improvement, Colao told reporters.
“We have lost a bit of market share, but I’m not too concerned about that,” he said. “Our focus now is on improving our network and service.”
Vodafone is also looking for consolidation in Europe and India to help increase market returns, Colao said. Neelie Kroes, the European Commission vice president in charge of creating a single market for telecommunications in Europe, is on the right track with a goal of making the continent work more like healthier markets in the U.S. and Asia, he said.
“Consolidation in Europe and in India has to happen,” Colao said. “Every politician and executive with long-term thinking knows that the sector needs enough returns to guarantee investments.”
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