Vodafone eyes up SFR in Vivendi fall-out
Vodafone Group Plc is expected to seize on the disorder at Vivendi Universal SA, following the departure of boss Jean-Marie Messier, by seeking control of France's number-two mobile operator SFR.
Weighed down with debt following an over-ambitious expansion program, Vivendi will be looking to sell non-core assets and it holds a 44% stake in fixed line operator Cegetel SA, which is Vodafone's partner in SFR with the Newbury, UK-based company owning a 31.9% stake.
Vodafone seldom rests happily with minority stakes in mobile operators and will seldom get a better opportunity to win control. Its one drawback is that Vodafone prefers to finance acquisitions with paper and its shares, which have been as high as 187.75 pence in the past year, currently languish as 90.5 pence.
Vodafone's balance sheet has been bolstered by the completion of a 1.15bn euros ($1.1bn) deal to sell its German railway specific telecommunications business, Arcor Telematik GmbH to German rail group Deutsche Bahn AG
The deal was announced in January and its completion gives Vodafone freedom to do what it chooses with Arcor's German fixed-line operations, a business Vodafone acquired as part of Mannesmann AG, but which senior management now believes is not core to operations.