Feeds

Vodafone swoops on Cegetel

Buys out BT, SBC

  • alert
  • submit to reddit

New hybrid storage solutions

Vodafone has delivered a knock-out blow in the tussle with Vivendi Universal to gain control of Cegetel, the French telecoms house. It is stumping up €6.3bn cash for the stakes held by fellow minority partners BT and SBC Communications, taking its share of the company to 56 per cent. And it has made a non-binding offer to buy Vivendi's 44 per cent in Cegetel for €6.77bn. This offer expires on October 30, leaving Vivendi with a very tight timetable to respond with a counter-offer.

Vivendi has pre-emption rights for Cegetel shares - it has until November 10 to match Vodafone's offer to BT. Also it has to beat the $2.27 bn cash offer to SBC by 13 per cent, according to Vodafone.

But where will Vivendi find the money? The company has debts of €19bn and there are serious doubts about its ability to service this. Vivendi's financial precariousness means that there will be no auction for Cegetel assets. And it also means that Vodafone is not paying top dollar - it says the transaction will be earnings enhancing

Vivendi had wanted to take its stake in the telco to above 50 per cent, enabling it to consolidate the company's balance sheet and strong cash flow. Failure to achieve this means that cash-strapped Vivendi may face problems in the future in paying down debt. But it can console itself with less jam today - Vodafone has tabled a non-binding offer of €6.3bn for its stake.

BT is to receive €4bn (£2.5bn) for its 26 per cent stake in Cegetel. This represents a return of 2.5 turns on its original investment, the company says. With this money banked, BT moves closer to its net debt target of £10bn, a mere bagatelle for a major-ish European telco. ®

The next step in data security

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
JINGS! Microsoft Bing called Scots indyref RIGHT!
Redmond sporran metrics get one in the ten ring
Driving with an Apple Watch could land you with a £100 FINE
Bad news for tech-addicted fanbois behind the wheel
Murdoch to Europe: Inflict MORE PAIN on Google, please
'Platform for piracy' must be punished, or it'll kill us in FIVE YEARS
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Sony says year's losses will be FOUR TIMES DEEPER than thought
Losses of more than $2 BILLION loom over troubled Japanese corp
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
Protecting users from Firesheep and other Sidejacking attacks with SSL
Discussing the vulnerabilities inherent in Wi-Fi networks, and how using TLS/SSL for your entire site will assure security.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.