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

To: Chuzzlewit who wrote (2172)	11/25/1999 11:44:00 AM
From: MrGreenJeans	Read Replies (1) \| Respond to of 3175

FOCUS-All eyes on Mannesmann as Vodafone climbs (Recasts with board meeting, fresh quotes, updates shares) By Kirstin Ridley LONDON, Nov 25 (Reuters) - Germany's Mannesmann AG is expected to unveil defence plans within days to fend off the world's largest hostile takeover attempt by Britain's Vodafone AirTouch Plc, analysts said on Thursday. As Vodafone's shares climbed over seven percent to boost the value of its Mannesmann bid to over 250 euros per share, or some 130 billion euros ($133 billion), speculation mounted that the German group was on the brink of declaring its hand. Mannesmann shares also rallied, paring recent losses and rising 15.55 euros to 202.60 ahead of a Sunday meeting at 1700 GMT of the group's supervisory board, which includes some of Germany's top industrialists and employee representatives. ``We now know the scale of German resistence,' said James Ross, telecoms analyst at ABN AMRO. ``It's an uphill struggle but we see Vodafone succeeding.' Mannesmann's stock continues to trade at a stubborn 25 percent discount to Vodafone's all-paper offer -- a sign that market experts are split on Vodafone's chances of success in its hopes to secure its future in Europe. ``The spread is not narrowing...So the market still believes there is a nervousness about this deal,' noted another analyst. BID FEVER GRIPS EUROPE Hopes of further bids in Europe in the wake of a U.S. merger frenzy, which has left telecoms giants reaching an end-game in terms of domestic size and scale, sent the entire European telecoms sector sharply higher. The pan European Dow Jones Stoxx Telecom index (^SXKP - news) leapt almost 5.0 percent to an all-time high of 650.05 by 1605 GMT, helped by Wednesday's warning from Vodafone Chief Executive Chris Gent that European carriers risked falling prey to U.S. bids. Such comments are helping fuel market speculation that U.S. carriers, such as acquisitive MCI WorldCom Inc (NasdaqNM:WCOM - news), are eyeing a high profile, hostile bid battle that could become the first launched by a foreigner to succeed on German soil. ``We recommend investors buy both Mannesmann and Vodafone,' said brokers CSFB. ``We think the deal has an increasing chance of going through in some form...(But) Mannesmann is caught in a difficult catch 22. We believe it will get taken over at some stage if its price continues to lag.' Vodafone's shares were trading 7.25 percent stronger at 299-3/4p by 1600 GMT and easily became the most popular stock in London, with over 169 million shares exchanging hands. Some brokers are warning that there would be a shortage in Vodafone stock following a successful Mannesmann bid, which would create one of the world's biggest telecoms companies in terms of market value. Vodafone-Mannesmann would be the biggest company in Germany and vie for top spot with BP Amoco/ARCO (quote from Yahoo! UK & Ireland: BPA.L) in the UK, leading to stiff competition for its shares among fund managers, keen to maintain a substantial weighting. With Vodafone offering 53.7 new shares for each Mannesmann share, institutional investors would see their holdings diluted to around 68 percent from 85 percent at present -- an underweight position worth up to 25 billion pounds. MANNESMANN ESCAPE? Some analysts believe Mannesmann's best chance of escaping Vodafone's clutches will be to highlight its growth potential and strategy in a stinging defence that ensures its share price surge above Vodafone's offer price. Newsflow from Mannesmann has increased since a regulatory restriction on the German company from presenting its side of the case was lifted on November 22, following its successful acquisition of British cellphone group Orange Plc (quote from Yahoo! UK & Ireland: ORA.L). Since then, the German company has announced that it plans to bring forward a planned demerger of its engineering and automotive units to focus on fast-growing telecoms. It has also unveiled a strong set of third-quarter results. ``It (a Mannesmann statement) could be in the next week or so,' said one analyst. ``The process has already started with their Q3 results on Tuesday.'