The paper states Vodafone, hungry to expand after receiving its Verizon Wireless windfall, would prefer to enter Brazil by taking a majority stake in one of the country's 3 top mobile carriers - giants Telefonica and America Movil control the other two - rather than by participating in an upcoming 4G spectrum auction.
TIM is estimated to have 26.9% of the Brazilian market, Telefonica's Vivo 28.7%, and America Movil's Claro 24.9%.
TI's own M&A plans could stand in the way of a Vodafone offer: The Italian carrier is reportedly weighing a bid to acquire Brazilian wireline carrier GVT, with the goal of trumping an existing offer from Telefonica and merging GVT with TIM.
On an organic basis (backs out forex and M&A), Vodafone's (VOD +2.6%) service revenue fell 4.2% Y/Y in FQ1 to £9.45B ($16.01B), a slightly bigger decline than FQ4's 3.8%.
European service revenue fell 7.9%, while all other markets grew 4.7%. However, the latter was down double-digits if forex is accounted for; weak Indian, Turkish, and South African currencies were responsible.
Vodafone's European mobile sub base fell by 1.77M to 127.1M - 878K subs were lost in Italy, 366K in Germany, and 236K in Spain. 80K were added in the U.K. With sub losses, declining voice/text revenue, and termination fee rate cuts taking a toll, service revenue fell 16.1% in Italy, 15.3% in Spain, 4.9% in Germany, and 3.2% in the U.K.
Mobile subs in all other markets grew by 6.37M to 303.7M (166.6M in India). 3.3M subs were added in India, and 3M by the African Vodacom unit. Service revenue grew 10.3% in India, and was flat in Vodacom markets (hurt by South African termination fee cuts). Europe is still 68% of service revenue.
£1.87B was spent on capex (£600M related to Project Spring), leading free cash flow to total -£582M. Net debt grew by £400M to £14.1B ($23.9B).
Vodafone (VOD -0.8%) and Portugal Telecom (PT +4.3%) plan to "deploy and share" and fiber networks covering 900K Portuguese homes through a 25-year deal that begins in December.
Vodafone, which has set an ambitious goal of offering mobile/wireline bundles throughout Europe (through a mixture of M&A, investments, and partnerships), notes the deal furthers its effort to provide fiber to 1.5M Portuguese homes by mid-2015. 1M+ homes are already covered.
The company has previously said it's open to buying a Portuguese cable provider, as it continues battling with both PT and local cable leader Zon Multimedia.
Meanwhile, Vodafone's Egyptian unit (55%-owned) says it plans to spend $1.3B over the next 3 years to strengthen its mobile network, and is still exploring the idea of offering wireline services. Last year, Vodafone said it would spend £1.5B ($2.5B) through FY16 on expanding 3G coverage in Asia-Pac and Africa, via Project Spring.
Vodafone, which has 25% of a Spanish mobile market that has been seeing steady revenue declines, plans to use ONO to offer quadruple-play packages. The carrier bought German cable provider Kabel Deutschland for $14.2B last year as part of its effort to offer mobile/wireline bundles in big European markets.
Shares are up moderately today, aided by an upgrade to Outperform from Macquarie.
After reporting yesterday that AT&T will be the exclusive provider in the U.S. for its new smartphone, Amazon (AMZN) is now in talks to determine who will be its provider in Europe.
The company has spoken to O2 (TEF) and Vodafone (VOD) in the U.K. If it chooses the latter, it would extend the two's relationship, as Vodafone provides the data plans shipped with the Kindle and the company's e-readers.
Amazon is set to reveal the smartphone rumored to feature a 3D display at an event in Seattle later today.
Vodafone (VOD) says that phones on its network are tapped in some of the 29 countries where it operates. The company exposed that secret wires allow government agencies to listen to live conversations and record them on its global network.
The company also states that customers have a right to privacy, but it still has to obey the laws of each country in which it operates. "Refusal to comply with a country's laws is not an option," says Vodafone.
Samsung (SSNLF) has announced its first commercial smartphone using the Tizen open-source platform. The Samsung Z featuring the new system will be available in Russia in the third quarter before expanding to other markets.
Tizen is being developed with companies including Intel (INTC) and Vodafone (VOD).
The new platform is revolutionary for Samsung, as the company is the world’s biggest maker of mobile devices using Google’s (GOOG, GOOGL) Android operating system.
Sprint (S) Chairman Masayoshi Son reasons that the rise in telecom and cable mergers should allow his company to buy rival T-Mobile (TMUS). Three big mergers have taken place in recent months with Verizon (VZ) acquiring Vodafone (VOD) for $130B, Comcast (CMCSA) buying Time Warner Cable (TWC) for $45B, and the AT&T (T) purchase of DirecTV (DTV) for $49B.
"Access to the Internet is currently dominated by three giants with no sizable competitor," says Son.
Although the company has not yet made a formal bid on T-Mobile, it looks to lay the framework for a future purchase.
Antitrust authorities have previously frowned on such a deal, as it would cut the number of national competitors in the wireless industry to three from four.
Vodafone's (VOD) FY EBITDA dropped 5.4% to £12.8B as revenue slipped 1.9% to £43.6B, hurt by the carrier's exposure to sluggish European markets.
Net profit attributable to shareholders soared to £59.25B from £413M a year earlier, boosted by the sale of Vodafone's 45% stake in Verizon Wireless for $130B, for which the British carrier received a one-off contribution of £48.2B.
Adjusted operating profit dropped 37% to £7.67B, mainly due to a much lower contribution from Verizon Wireless before it was sold.
In Q4, organic service revenue declined 3.8%, although that was slightly less than consensus of -3.9%.
Expects FY 2015 EBITDA to drop to £11.4-11.9B.
"Our operational performance has been mixed," says CEO Vittorio Colao. While Vodafone's "emerging markets businesses have performed strongly," in Europe, the company continues "to face competitive, regulatory and macroeconomic pressures."
Vodafone declared a final dividend of 7.47 pence a share, giving total dividends of 11 pence, up 8%. (PR)
Bloomberg and WSJ reports suggesting AT&T (T -1.3%) is close to a mega-deal for DirecTV (DTV +0.7%) (possibly worth over $66B after factoring net debt) are leading investors to bet Ma Bell won't be interested in making a bid for Vodafone (VOD -2.2%), something the company has been frequently rumored to be interested in exploring.
AT&T CEO Randall Stephenson has already said "the window may be closing" on acquiring European assets, and has suggested he isn't thrilled with Vodafone's efforts to grow its wireline footprint via M&A.
For his part, Vodafone CEO Vittorio Colao has hinted he's open to a deal, but has also made it clear his company will continue its wireline expansion strategy in the interim.
AT&T, which didn't sell off following prior DirecTV reports, is off moderately today, as the Street expresses some concern over the potential $100/share price tag mentioned in Bloomberg's report.
DirecTV (DTV +0.7%), meanwhile, has pared its AH gains and is now only trading near $88. Worries about regulatory approval might be playing a role; a Bloomberg source states AT&T and DirecTV are expecting a 12-month regulatory process for the deal.
Netflix (NFLX +3.6%) is in talks with Vodafone (VOD +1.1%) about a deal that would give the giant international carrier's subs "free access to Netflix content for a period of time," Bloomberg reports.
Vodafone has majority ownership of networks in 15 European countries, including three Netflix markets - the U.K., Ireland, and the Netherlands. The company already has deals with Spotify and Sky Sports that provide free content access to new U.K. 4G subs.
The report comes as AT&T tries to get Netflix and other streaming service providers to sign up for its Sponsored Data program, which allows content providers to subsidize customer data usage.
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.