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Vodafone gets out of China

Turning a tidy profit on the deal

Application security programs and practises

Vodafone is planning to raise $4.3bn selling its stake in China Mobile, and will be handing most of the cash to its shareholders.

The deal will be done through an "accelerated bookbuilt" arrangement, backed by some of the more popular investment banks. About a third of the money will be dropped into Vodafone's existing debt, and 70 per cent spent buying back its own shares.

It might seem a strange time to get out of China, but Vodafone, the world's largest mobile operator by revenue, has almost doubled its money since buying the shares in 2000. One can't help wondering if the sell off portends some sort of Chinese expansion for Vodafone - or perhaps China Mobile is the one looking to spread its wings a little.

Vodafone, naturally, said it has enjoyed working with China Mobile over the last decade and it looks forward to remaining friends with the world's largest mobile operator by customers.

The two networks have worked together effectively: among other things the two companies created the Joint Innovation Lab, which spawned the Wireless Application Community that remains the great white hope for operators wanting to get into the application business. Operating in separate territories there was no problem with Vodafone holding shares in China Telecom, but such companies like to have a global presence these days, making cross ownership more difficult than it used to be. ®

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