POLL-Vodafone bid has 60 pct chance of success
By Penny MacRae
LONDON, Nov 19 (Reuters) - Mobile phone giant Vodafone's hostile bid for its European partner Mannesmann has a better than even chance of success -- but it's far from a done deal, according to analysts surveyed by Reuters on Friday.
The analysts in London, Munich and Frankfurt put the probability of Vodafone AirTouch Plc (quote from Yahoo! UK & Ireland: VOD.L) clinching its 124 billion euro ($127.4 billion) offer for Mannesman AG at 60 percent, according to the median figure.
The odds of the world's biggest cellphone operator winning Mannessman given by the eight analysts ranged from a paltry 20 percent to 80 percent.
However, seven of the eight said the all-paper offer price was fair, saying it represented a massive premium to Mannesmann's share price before Vodafone's bid was rumoured.
The lone dissenter was a Frankfurt analyst who saw only a 20 percent chance of success without a cash component.
Vodafone offered on Friday 240 euros per Mannesman share in its battle for mobile phone supremacy in Europe.
WHITE KNIGHT RULED OUT
All of the analysts ruled out chances that Mannesmann would seek a white knight to escape Vodafone's embrace, saying there was no better fit for the German company than Vodafone.
``If they tried, it would be a nationalistic thing that would be hard to justify to its shareholders who are international and getting more so with the (Mannesmann's) Orange acquisition,' said Tressan McCarthy of Credit Lyonnais in London.
Alexander Blaich of BNP in Frankfurt added that a key part of Mannesmann's strategy was to stay independent.
``If they tried to merge with someone who didn't have such a clear cut strategy (as Vodafone) it would be seen as a very defensive move,' he said. ``It would harm the image of (Mannesmann's chief executive) Klaus Esser who would be seen as thinking of his job, not of shareholders.'
Analysts said Friday's fall in Mannesmann's shares was a sign, however, that some investors were skeptical Vodafone would win the day. Mannesmann shares closed down 14.4 euros at 193.10.
There has been union and political opposition in Germany to the proposed deal which -- if it goes ahead -- would be the first successful hostile bid in Germany's history.
``But if nobody believed it was going to happen, Mannesmann's share price would have collapsed,' said one London-based analyst who did not wish to be named.
``I think on balance it should happen, I can't think why it wouldn't happen but the market is obviously not taking it for granted,' he said.
A Frankfurt analyst said Germans could not believe one of their grandest industrial ventures was the target of a British takeover bid but would eventually accept the idea.
``Normally Germans buy English companies,' he said. ``It will be a learning curve for Germans.'
Analysts said the international makeup of Mannesmann's share base would make it tougher for the German company to resist Vodafone's offer on nationalistic grounds.
The international shareholders ``will be less interested in nationalistic concerns and more looking toward the synergies in a combined group,' said Matthew Lewis of Daiwa in London. |
