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Technology Stocks : Vodafone-Airtouch (NYSE: VOD) -- Ignore unavailable to you. Want to Upgrade?

To: David Wiggins who wrote (2049)	11/8/1999 8:31:00 AM
From: MrGreenJeans	Respond to of 3175

FOCUS-French ally may ease Vodafone Mannesmann bid (Rewrites with analyst and banker comments, updates shares) By Kirstin Ridley LONDON, Nov 8 (Reuters) - Cellphone giant Vodafone AirTouch Plc (quote from Yahoo! UK & Ireland: VOD.L) is likely to bide its time before pouncing on former European ally Mannesmann AG in a deal that could value the German group at over 80 billion pounds ($130 billion). But because Mannesmann has launched a $33 billion bid for Vodafone's British arch-rival Orange Plc (quote from Yahoo! UK & Ireland: ORA.L), any deal would have to include a sale of Orange -- and France Telecom is increasingly being tipped as the most likely buyer. Analysts said on Monday that the French were ``natural bidders' for Orange, because they could roll the innovative cellphone group into Britain's biggest cable company, Nasdaq-listed NTL Inc (NasdaqNM:NTLI - news), in which they hold a 25 stake. ``Vodafone is being forced into a corner. But they have to do something and a relationship with France Telecom makes sense -- although price remains key,' said one analyst. BID TALK PROPELS SHARES Renewed speculation of a bid, this time from the Sunday Telegraph, sent Orange and Mannesmann shares to 12-month highs of 16.00 pounds and 165.5 euros respectively. Orange was at 15.89 pounds, a rise of 1.5 percent and Mannesmann at 163.70 euros by 1215 GMT. Vodafone slipped by 0.8 percent to 314-1/2p. Vodafone, a long time suitor of the German group, is a minority partner in Mannesmann's key German and Italian networks. But Mannesmann's declaration of hostilities with its Orange bid is triggering mounting speculation that Vodafone will eventually be stung to bid to protect its European investments. ``My feeling is that this is something Vodafone wants to do. They want to own Mannesmann's continental assets, there's no doubt about it,' said another analyst. ``But it's a question of at what price and how. I think it is likely that they will wait,' the analysts added, noting that the longer Vodafone waited, the better a price it would be able to get for Orange as cellphone company prices surge. However, under British competition laws Vodafone will be unable to own two UK mobile phone businesses and banking sources say any bid for Mannesmann will have to involve a pre-sale agreement of Orange with the French. ``I'm sure they are looking at it -- as they have to be,' noted one investment banking source. ``But nothing implies there is something about to happen.' The Sunday Telegraph reported that Vodafone was in talks with France Telecom about a joint 45 billion pound hostile bid for the German company and that the British-based group was sounding out investors on such a move. But some analysts believe any bid for an enlarged Mannesmann would be more likely to command a hefty premium and value the group at nearer 80 billion pounds, including debt. Vodafone, which is in a quiet period ahead of half-year results on November 16, France Telecom and Mannesmann declined to comment. ``We dont comment on press speculation or market rumour,' a Vodafone spokesman said. POISON PILLS Although Mannesmann's aggressive Chief Executive Klaus Esser has said he doubts his company would be the target of a takeover by Vodafone, analysts believe he cannot affort to be complacent. Some analysts say about 60 percent of Mannesmann's equity is owned outside Germany and predominantly by U.S and UK investors, who are likely to take the view that Vodafone is as good a company to run Mannesmann's businesses as the German group. But one reason why some believe Vodafone might play a longer game is because of Mannesmann's articles of association, which specify that no investor can vote a shareholding of more than five percent -- regardless of how much stock they hold. Although the five percent ceiling will be abolished around next June, some experts believe Vodafone might have to sell Orange at a steep discount to the heady price paid by Mannesmann in return for control of its European assets. ``It's not a walk in the park for Vodafone to proceed with this, not to mention succeed,' said another analyst. "Their hand is being forced and I think they have to act sooner rather than later because it's such a dynamic industry. The longer they leave it, the less it is in their control. ``But they are going to have to pay a significant premium and it will not be easy

To: David Wiggins who wrote (2049)	11/8/1999 1:31:00 PM
From: MrGreenJeans	Read Replies (1) \| Respond to of 3175

Mannesmann Said Eyed for Takeover LONDON (AP) -- Vodafone AirTouch PLC, the world's largest mobile phone company, and French telecommunications leader France Telecom are reportedly considering making a joint takeover bid for Germany's Mannesmann AG. A potential offer of 45 billion pounds, or $72 billion, would be the latest step in the breakneck consolidation of Europe's phone businesses. Such a bid would equal more than twice what Mannesmann agreed to pay last month in a friendly offer for Orange PLC, the smallest of Britain's four mobile carriers. France Telecom is eager to own Orange, which Vodafone would have to sell if it took over Mannesmann, the Financial Times reported. Under British law, no company can hold more than one mobile phone license. Vodafone and Mannesmann called newspaper reports speculative and refused further comment. Calls to France Telecom seeking comment were not returned. Vodafone has had a close relationship with Mannesmann and is believed to have been unhappy about Mannesmann's planned purchase of Orange. It played down any possible competitive threat when Mannesmann announced its buyout of Orange last month. Mannesmann still must obtain approval from Orange shareholders for the deal to proceed, but Hong Kong-based Hutchison Whampoa, Orange's biggest shareholder, has already agreed to the purchase price. Mannesmann, an engineering firm, has evolved into Germany's No. 1 mobile company since buying two Italian phone companies this summer in a deal with Olivetti SpA. By purchasing Orange, it would become the biggest mobile phone company in Europe. Mannesmann would gain a strong foothold in Britain, where Orange has an 18 percent market share. However, many analysts and investors said the German company's offer of $32.9 billion for the firm was too high. Other companies, including at least one from the United States, have also expressed interest to Vodafone in buying Orange, The Guardian newspaper reported. Vodafone shares were down 0.4 percent at midday from Friday's close in London, while Mannesmann stock was trading up 2.2 percent in Frankfurt, Germany. In Paris, France Telecom was down 2.0 percent. This year has seen a series of wireless takeovers and partnerships, beginning when Britain's Vodafone bought AirTouch Communications of the U.S. for $56 billion, creating Vodafone AirTouch. Last month, France Telecom announced plans to buy a majority stake in E-Plus, Germany's third-largest mobile network, for $7.9 billion. Deutsche Telekom of Germany said a deal to increase its presence in France was expected soon. And in recent months, mobile calling ventures have been formed between AT&T (NYSE:T - news) and British Telecommunications and between Bell Atlantic and Vodafone AirTouch.