Thursday December 21, 2:30 pm Eastern Time
Forbes.com
Around-The-Globe: Vodafone On A Roll
By Todd Jatras
U.K.-based Vodafone today snapped up Eircell, the wireless division of Ireland's Eircom, for $4.09 billion in an all-stock deal that is the largest corporate transaction in Irish history.
The deal calls for Eircom shareholders to receive 0.95 shares of Vodafone (NYSE: VOD - news) for every two shares and will likely be completed in the first half of 2001.
Vodafone has been on a roll this week and has aggressively expanded its global portfolio this year like no other company. It will pick up 1.2 million Irish subscribers--60% market share--in today's deal and can now boast more than 65 million subscribers worldwide, making it the number one wireless operator in the world.
Yesterday the company paid $2.2 billion for a 15% stake in Japan Telecom, a move that analysts described as a classic case of it outdueling two of its fiercest rivals in the international wireless game, debt-burdened British Telecom (NYSE: BTY - news) and Japan's NTT DoCoMo.
Vodafone trumped BT in a similar manner earlier in the year by acquiring a minority stake in Spanish wireless company Airtel Moviles, then steadily increasing its stake to 65.2%. That is the likely strategy in Japan, where AT&T (NYSE: T - news), which holds a 15% stake in Japan Telecom, is reportedly looking to divest, and Vodafone would presumably be there to snap up those shares.
A wide swath of blockbuster deals have already fallen into place this year, most impressive of which was Vodafone's April acquisition of Germany's Mannesmann, the biggest ever hostile takeover bid at $161 billion.
Last month the company agreed to buy a 25% stake in Swisscom's cellular unit for approximately $2.85 billion, and recently it took a 2.2% stake in China Mobile for $2.5 billion.
Elsewhere, Vodafone has doled out billions of dollars acquiring third-generation mobile licenses, and has been one of the most active players in auctions all over the world, from New Zealand to the United States, Germany, the U.K., France and Italy.
Vodafone clearly views the wireless world as it's pearl and is willing to spread its cash around the world in an effort to vanquish its competitors. But with such high stakes and with telecoms continuing to take an unprecedented battering, Vodafone must be careful not to overextend itself. |
