Report: Vodafone resumes talks to acquire ONO


Sky News reports Vodafone (VOD +0.8%) has restarted talks to acquire Spanish cable giant ONO, and that a deal could be worth €7B ($9.6B).

However, the talks are said to be "at a tentative stage," with Vodafone pessimistic about its ability to get ONO shareholders to call off a planned IPO. Bloomberg reported last month an ONO bid would need to be in the €7B-€8B range to win board approval.

Vodafone appears intent on using some of its Verizon Wireless cash to grow its European wireline reach. AT&T isn't pleased.

From other sites
Comments (2)
  • Mike Sieber
    , contributor
    Comments (21) | Send Message
     
    I would not be so sure that AT&T is not pleased with the VOD bid for ONO. In a few months AT&T is expected to once again bid on VOD. If in the meantime VOD acquires ONO with VZ money isn't that a 2 for 1 win for AT&T.
    4 Mar 2014, 11:12 AM Reply Like
  • 15865932
    , contributor
    Comments (441) | Send Message
     
    Correct Mike Sieber. Conflicting information reported by WSJ vs. Bloomberg sources on T insiders view of Ono approach. Part of what has been indicated by AT&T's Stephenson is a view there is untapped value potential in bundled service premiums in the EU. Ono's fiber network covering Spain's rural areas compliments VOD's large city network and would give VOD a serious market foothold +20% in Spain. (Like when VZ purchased Alltel in U.S.) It is wiser to have good fiber network for data backhaul vs. purchasing additional spectrum in each EU country. $$$ savings.

     

    Few months away expectations for a T bid to emerge is putting the retail investor to sleep. You snooze, you loose. Bloomberg piece a couple days after the no interest filing had insiders indicating the no interest filing with U.K. takeover regulator was purely technical (would have mandated a bid within 28 days) and cited possible exemptions to the six month rule.

     

    Exemptions
    1)VOD board can waive the six months restriction.
    2)T could competitive bid if 3rd party made offer (i.e. Softbank bids for VOD)
    3)U.K. takeover panel agrees there has been a material change in the company. Two days after AT&T filed no interest, VOD shareholders approved the return of value in a vote which gave cash AND VZ SHARES to VOD shareholders. February 21 VOD received proceeds from VZ sale. IN turn VOD disposed of 24B in cash and 60B in VZ stock to its shareholders which cut VOD's market cap to nearly half. The panel would have to agree there has been a material change since T filed no PRIOR to the VOD shareholder vote for the return of value aka special dividend. VZ no longer held by VOD also equals no antitrust issues for a purchase of VOD that would need to be circumnavigated.

     

    Essentially the T filing can be thrown out the window as well as the six month bid restriction.

     

    Believe T could be behind VOD bidding for these assets to build/acquire a massive EU wide data backhaul network in preparation for 4G upgrades and beyond. The fiber toll roads will also cover big data usage by Whatsapp users using VOIP when it is launched in coming months. Dodge the phone towers using VOIP and you will still pay the toll road owners.....
    4 Mar 2014, 07:33 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs