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To: quidditch who wrote (31989)	6/8/1999 5:02:00 PM
From: Ruffian	Read Replies (1) \| Respond to of 152472

Vodafone> June 9, 1999 Vodafone Sees $3 Billion in Spending If Forced to Compete with Bell Atlantic Dow Jones Newswires Vodafone Group PLC Tuesday reported a 44% increase in pretax profit to 935.2 million pounds ($1.5 billion or 1.45 billion euros) for the fiscal year. But the British mobile-telephone company said it may have to spend up to $3 billion over the next few years if it has to go head-to-head with Bell Atlantic Corp. in the U.S. The pretax earnings figure includes a 66.7 million pound investment gain. Without the gain, the figure would have been 868.5 million pounds. The gain mainly relates to the sale of part of Vodafone's stake in GlobalStar Telecommunications Ltd. Vodafone said it is planning a bonus-share issue, giving shareholders four new shares for each one currently held. The issue is conditional on the completion of its takeover of AirTouch Communications Inc. of the U.S. Vodafone also reported that its world-wide customer base had reached 10.4 million, with 4.6 million added during the reporting period, which ended March 31. Performance of the group's international operations grew strongly, both in terms of sales, up 82% to 1.27 billion pounds, and operating profit, up 161% to 319.4 million pounds. This possibility of increased expenses in the U.S. came as the company capped a year of rapid expansion. The profit surge came mainly from the group's international businesses, particularly in Australia, France and Greece. Earnings in the United Kingdom rose 14% as the pay-as-you-talk initiative took hold. As Vodafone attempts to complete its acquisition of AirTouch, the British company is facing the prospect of seeing two key U.S. joint ventures dissolved by Bell Atlantic, which is also trying to take over GTE Corp. Shareholders of AirTouch last week approved the proposed Vodafone takeover. The deal will create the world's largest wireless-communications company. The new company will have significant presences in the U.S., U.K., Europe and Asia-Pacific region. But agreements between Bell Atlantic and AirTouch Communications bar each party from competing in wireless communications. If they are dissolved, Vodafone AirTouch, as the merged company will be known, will have to establish positions in large areas of the U.S., from the East Coast to the Midwest. "We will either have to buy assets from those with existing operations or spectrum or from the government itself and start building," Vodafone Chief Executive Chris Gent told a press conference Tuesday. "This will cost around $2 billion to $3 billion and would take around two to three years to execute," he said. "This is not an attractive option, but it is open to us. If the ventures [with Bell Atlantic] fail, then this will be a priority for the new company." A Bell Atlantic spokesman confirmed that the group will dissolve its PrimeCo personal communications joint venture with AirTouch once the Vodafone-AirTouch merger is complete. AirTouch and Bell Atlantic also formed another joint venture, the Technical Operations and Marketing Agreement, which prevents either party from entering each other's territories, in return for marketing and technological agreements. Bell Atlantic is going through the legal process to dissolve this as well, even though no breakup scenario was envisaged when the two signed the deal in 1994. Use the Euro Currency Converter to calculate the value of the 11 euro-zone currencies versus the euro.