French telecoms billionaire Xavier Niel, through his investment vehicle Vega, has acquired a 16.2% stake in Vodafone from Emirates Telecommunications Group (e&) for £4.4 billion ($5.91 billion). This deal makes Niel Vodafone's largest shareholder. The purchase price of 110.4792 pence per share represented a 13% premium over Vodafone's closing price on Thursday. Following the announcement, Vodafone's shares surged by 12.6% to 110.10 pence in early Friday trading, indicating strong market confidence in Niel's involvement and Vodafone's future.
Vega stated its intention for a "long-term, strategic minority shareholding" and confirmed it has no plans for a full takeover. However, analysts like Dan Coatsworth of AJ Bell noted that the acquisition could fuel speculation about a future full bid. Vodafone welcomed Niel's investment, acknowledging him as a supportive, long-term shareholder who recognizes the quality of its diversified operations and potential for growth. The company also immediately terminated its relationship agreement with e&, leading to the resignation of Hatem Dowidar from Vodafone's board.
This transaction positions Niel, known for his consolidative efforts in European telecoms, as a significant influence on Vodafone's strategic direction. Vodafone has been undergoing restructuring under CEO Margherita Della Valle, focusing on key markets like Germany, Britain, and Africa after exiting Spain and Italy. The company also completed its merger with Three UK. Niel's previous attempts to acquire Vodafone's Italian business were unsuccessful, and he sold a prior 2.5% stake in Vodafone acquired in 2022. The deal also represents a shift for e&, which had initially aimed for global expansion but is now refocusing on its core businesses.
