Today, 10:06 AM
- BT Group (BT -0.6%) is keeping up the pressure in its response to a strategic review by UK telecom regulator Ofcom, saying that there's no case for divesting its Openreach wholesale access business -- a move it says would hurt the UK's "digital health" -- and pointing regulators instead toward the dominance of pay-TV rival Sky (OTCQX:SKYAY -0.9%).
- The regulator is conducting its first strategic review of the sector in 10 years amid some key and rapid change.
- BT in February agreed to a $19B acquisition of EE, the UK's top mobile firm, raising vocal calls from competitors (especially Vodafone) over network access. Liberty Global (LBTYA +0.3%) and Vodafone (VOD +0.3%) discussed -- and then dropped -- a merger or asset swap in Europe. And the UK's second- and fourth-largest mobile firms are pursuing a $15.7B merger.
- This summer, a determined BT CEO Gavin Patterson threatened the specter of a decade of litigation over Openreach if the company were forced to unload it. Now it says that the existing "functional separation" of its units has served the UK "exceptionally well over the past decade."
- Elsewhere, Citigroup today reiterated its Neutral rating on BT Group.
- Previously: BT Group up as Societe Generale reiterates Buy rating (Sep. 23 2015)
- Previously: BT Group recommits to 10M homes with ultrafast broadband by 2020 (Sep. 22 2015)
- Previously: Vodafone, rivals renew call for BT Openreach split (Sep. 21 2015)
Yesterday, 10:29 AM
- India's Bombay High Court has ruled in favor of Vodafone (VOD -0.4%) in a $1.3B tax case between the carrier and India's government.
- The case had to do with transfer pricing in international transactions, which often prompt questions about how to value the deals for tax purposes.
- “We hope the government won’t file an appeal,” says Vodafone lawyer Balbir Singh.
- Prime Minister Narendra Modi has made stable tax rules a policy focus following previous disputes with multinational companies.
Wed, Oct. 7, 12:45 PM
- The breakdown of talks over a tie-up with Liberty Global (LBTYA -0.3%) means that Vodafone (VOD -1.1%) and CEO Vittorio Colao will need a more unglamorous strategy of cable and network investments to start paying off.
- The carrier is now getting calls from bankers to go forward with floating its India mobile business. Management will be focused on running its biggest markets to return to steady growth.
- "We really need to see an operational turnaround in Europe in this fiscal year," says Axa's Bruno Grandsard. "That is priority number 1, 2, and 3, including the integration of cable assets in Germany and Spain."
- Vodafone had bought Kabel Deutschland in Germany and Ono in Spain to compete with incumbents in those countries. Germany is Vodafone's biggest sales market, and Kabel Deutschland has been coveted by Liberty Global in talks about European asset swaps.
- Despite the breakdown of those talks, observers inside and outside Vodafone think Liberty Global will come calling again eventually, possibly a year from now, with the promise of some €20B in cost savings, largely in the UK and Germany.
Tue, Oct. 6, 2:30 PM
- Vodafone (NASDAQ:VOD) has set a master services agreement with UK dark-fiber specialist CityFibre for connectivity to its cell sites and to some enterprise customers, starting with York.
- The move comes as CityFibre and mobile providers may be looking for backhaul alternatives to BT Group (NYSE:BT), which is planning to take over EE, the country's biggest mobile operator, and thus get into mobile competition.
- CityFibre also has a deal to provide connectivity to a joint venture between EE and Three UK -- a pact that could change with the BT/EE merger.
- CityFibre is up 6.7% in London trading.
- Previously: Vodafone call: CEO Colao again presses for BT breakup (Jul. 24 2015)
- Previously: UK regulator fast-tracking review of BT Group/EE merger (Jun. 09 2015)
- Previously: BT wraps £12.5B deal to buy Britain's largest mobile firm (Feb. 04 2015)
Fri, Oct. 2, 12:50 PM
- Vodafone UK (VOD +1.7%) has launched new Rich Communications Services to add new features to phone calls, though so far there's no indication of it rolling out voice over LTE.
- Its Call+ offering adds context and file-sharing to regular voice calls, following up on Wi-Fi calling rolled out last month.
- With Rich Communications Services, customers can share fiels including maps, pictures and contact details during a call, as well as set subject lines and importance for calls before they start, or add text notes alongside missed calls.
- The features work on Android smartphones at the moment.
Fri, Oct. 2, 9:15 AM
- Orange (NYSE:ORAN), down 2.3% premarket, is in the end stages of talks to sell a 70% stake in Orange Kenya, the country's Treasury Cabinet Secretary Henry Rotich says.
- The deal's coming "very soon," he says, likely before year-end. Orange had paid $390M for the stake in 2007.
- Abandoning Kenya would mean another operator getting out and leaving the country to Safaricom, part owned by Vodafone (NASDAQ:VOD), which has taken advantage of its development of the M-Pesa mobile payment system.
Wed, Sep. 30, 2:07 PM
- Vodafone Hutchison Australia (VOD +2.1%) has signed deals for more than a billion Australian dollars ($700M) to migrate mobile customers of TPG Telecom (OTC:TPGTF) to its network, from previous host Optus.
- The changeover -- "one of the industry's largest ever mobile virtual network operator (MVNO) arrangements" -- means faster 4G access for TPG customers.
- The deal also has TPG supplying dark fiber and network services to 3,000 Vodafone sites, generating A$900M in revenue against a spend of A$300M-A$400M over the next few years on the project.
Tue, Sep. 29, 9:27 AM
- Vodafone (NASDAQ:VOD) is up 0.9% in premarket U.S. trading after analysts reiterate their Buy calls, following the news that Vodafone and Liberty Global broke off talks about an asset swap.
- Deutsche Bank reiterated its Buy rating with a 270-pence price target; shares are flat in London trading at 207.15p, implying 30% upside in its target.
- Beaufort Securities reiterated its Buy rating as well. Later yesterday, Barclays also had reiterated its Overweight rating, with a 250-pence target.
- Vodafone ADRs fell 5.2% yesterday after the news that it was terminating talks of a tie-up with the John Malone-led media giant.
Mon, Sep. 28, 9:39 AM
- Vodafone (VOD -3.1%) and Liberty Global (LBTYA -3.7%) were among early premarket sliders in telecom today after the two broke off discussions over swapping European assets.
- The cost of insuring Vodafone's debt dropped the most in nearly four months, and bonds of Liberty Global's units fell to their own records. Virgin Media (a likely Vodafone target) saw its January 2025 bonds slip to 92.8c/euro, lowest since issuance, while Germany's Unitymedia bonds fell 5.1 cents to a record low 84.4 cents.
- Barclays reiterated its Overweight rating on the shares with a 250-pence price target. Shares are down 3.7% in London to 209.7p, implying a 19% upside in Barclays' target.
- Previously: Vodafone ends talks with Liberty Global over asset swaps (Sep. 28 2015)
Mon, Sep. 28, 2:48 AM
- Vodafone (NASDAQ:VOD) says it's called off talks with Liberty Global (NASDAQ:LBTYA) over a swap of assets.
- Amid rumors of an outright merger earlier this summer, the two confirmed they were talking about swapping some European businesses, but the talks faced challenges from the outset and are over for now.
- The companies never specified which assets -- though the best fit seemed to be where they had heavy overlap: in Germany, the UK and the Netherlands. But the UK is Liberty's largest market, and Germany is Vodafone's biggest sales market, and it seemed increasingly unlikely the two would bail out of those markets.
- Liberty had long coveted Vodafone's bigger Kabel Deutschland business, while Vodafone probably was looking at Liberty's Virgin Media.
- Previously: Vodafone -2.3% as Liberty Global tie-up seems troubled (Sep. 15 2015)
- Previously: Summer's end may bring resolution for Vodafone, Liberty (Aug. 17 2015)
Tue, Sep. 22, 9:56 AM
- Speaking at a company conference (and playing defense after a new attack from rivals), BT Group (BT -2.1%) chief Gavin Patterson said the company's ultra-fast broadband service (300-500 Mbps) would be delivered to 10M premises by 2020.
- "We want to forge an ultra-fast future for Britain and stand ready to help government deliver the broadband speeds necessary for every property to enjoy modern-day Internet services, such as high definition TV streaming and cloud computing," Patterson says. "To achieve this, we need a collaborative effort across industry and government."
- The statement comes after a fresh offensive from competitors led by Vodafone (NASDAQ:VOD) over splitting the wholesale Openreach business from BT.
- BT has opened a trial of its G.fast offering involving up to 4,000 premises. It plans to hit the 10M-premise target with a combination of G.fast and fiber to the premises.
- A hint of 1-Gbps service suggests the company may also bring fiber-on-demand back from the dead.
- Previously: Vodafone, rivals renew call for BT Openreach split (Sep. 21 2015)
Mon, Sep. 21, 10:38 AM
- Vodafone (VOD +0.5%) and other rivals of BT Group (BT -0.3%) have renewed their call for radical reform of the UK telecom market, including a competition investigation and a split of wholesale business Openreach from BT Group proper.
- In an open letter in the Financial Times, chiefs of Vodafone UK, Sky (OTCQX:SKYAY), TalkTalk (OTC:TKTCY) and Daisy Group claim that British regulator Ofcom has found serious problems in the ownership of the national network by BT Openreach.
- For its part, BT Group says that it continues to invest billions in Openreach and that the business is exceeding service targets set by Ofcom.
- Meanwhile, Vodafone's tie-up talks with Liberty Global (LBTYA +0.6%) are snagging over complicated tax arrangements at Liberty and its Virgin Media cable net, The Telegraph reported. The companies have discussed swapping assets, but Liberty reportedly depends on Virgin Media's billions in losses to lower its tax burden.
Fri, Sep. 18, 1:25 PM
- Antitrust regulators in Europe are set to launch a wide probe into Hutchison Whampoa's (OTCPK:HUWHY) £10.3B bid for O2, the UK mobile unit of Telefonica (TEF -4.1%) -- which likely means key concessions are coming, Reuters reports.
- The plan to merge Hutchison's Three with O2 was a long time coming, and now it's facing what looks like a sterner regulatory regime whose stance helped kill a plan to merge the Danish operations of TeliaSonera and Telenor.
- The EU's competition authority has an Oct. 16 deadline for preliminary review but is expected to follow with a full-blown investigation that should last five months.
- Proper concessions are likely to be challenging, however: Three UK shares a 3G network with market leader EE (ORAN, OTCQX:DTEGY), while Telefonica shares some towers with Vodafone (NASDAQ:VOD) -- which has been vocal about ensuring competition as the UK market consolidates.
Tue, Sep. 15, 9:32 AM
- Vodafone (NASDAQ:VOD) is off 2.3% amid the newly tougher regulatory scheme that likely has put a kibosh on a merger with Liberty Global (NASDAQ:LBTYA).
- A shift in approach to the hard line by European Commission competition chief Margrethe Vestager recently got TeliaSonera and Telenor to call off a merger of their Danish operators. And Liberty is offering up fresh concessions in an effort to seal its effort to buy KPN's Belgian operator Base.
- John Malone is still looking for common ground with Vodafone over some kind of tie-up, he tells Bloomberg, as those talks seem to stall. Discussions about a full merger that initially moved stocks turned to talks over an asset swap in Europe, as Vodafone insists it's not talking about the full deal.
- "Obviously there’s a price at which Liberty Global could be bought," Malone said. "I don’t believe that that’s likely for the other side to get there -- an outright purchase of the whole company. Other than that, it’s a question of could you figure out some way to live together."
- Vodafone chief Vittorio Colao should "retire" now that the merger talks have fallen apart, says telecom analyst Neil Campling of Aviate Global. Asset swaps seem unlikely in key markets the UK and Germany, he says. “While we can find reasons to invest in Liberty Global on a standalone basis, the same cannot be said for Vodafone," he says. "What's next? Vittorio, surely, will retire and head for the sunshine/ski slope. He should.”
- Meanwhile, Vodafone India has begun talks with IBM to renew a 660B-rupee ($1B) outsourcing contract that expires in June. Other vendors, including Wipro, Tata Consultancy, Infosys and Tech Mahindra, could push for the deal.
Mon, Sep. 14, 8:06 PM
- In a market recently hot with network improvement talk, Three UK (OTCPK:HUWHY) has announced its commercial launch of voice-over-LTE and the debut of its 800 MHz spectrum.
- The company's calling it "4G Super-Voice" to communicate the move to consumers, who should benefit from better indoor coverage with the user of the lower frequencies. Three's beating EE (ORAN, OTCQX:DTEGY) and Vodafone (NASDAQ:VOD) to the VoLTE punch.
- Three says a million of its customers will have access by the end of the year, and that the technology already covers 50% of the UK's population for indoor coverage and more than 75% of London, Edinburgh, Exeter and Birmingham.
Mon, Sep. 14, 9:18 AM
- Vodafone (NASDAQ:VOD) is off 1.8% premarket in U.S. trading after early-a.m. analyst action.
- Shares are down 1.1% in London as Nomura cut its price target to 275 pence from its previous 290 pence, while maintaining a Buy rating. Shares are trading currently at 221.46p, implying more than 30% upside.
- Meanwhile, Credit Suisse has reiterated its Outperform rating, with a target of 250 pence (12.9% upside from current trading).
- Both those targets are slightly higher than consensus, which sits just over 239 pence.
- Vodafone ADRs are down 7% over the past month.
VOD vs. ETF Alternatives
Vodafone Group PLC is engaged in providing voice and data communications services for all types of customers. The Company has presence in Europe, the Middle East, Africa, the Asia Pacific region and the United States.
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