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

To: MrGreenJeans who wrote (2491)	2/3/2000 10:03:00 PM
From: MrGreenJeans	Read Replies (1) \| Respond to of 3175

FT 2/4 Mannesmann submits to Vodafone bid By Ralph Atkins in Dsseldorf, William Lewis and Richard Waters in New York and Peter Thal Larsen in London Mannesmann on Thursday night capitulated to a œ113bn takeover from UK wireless rival Vodafone AirTouch. It is a deal that will throw open the corporate doors of Europe and pave the way for a wave of cross-border mergers and acquisitions. The merger is the largest takeover of all time, ranking above AOL's recently announced deal with Time Warner, and will generate the largest adviser fees, at almost œ600m. Mannesmann announced it had agreed with Vodafone that the German group's shareholders will take 49.5 per cent of the combined company. The UK group is offering 58.96 of its shares for each Mannesmann share, valuing Mannesmann shares at E353. The terms are expected to be approved by the Dsseldorf-based company's supervisory board on Friday. They also require approval from shareholders. "It's been a long run, but it's been a pretty friendly hostile," Chris Gent, chief executive of Vodafone, said last night. "Mannesmann - a great company - will be better with Vodafone." Klaus Esser, chairman of Mannesmann, said his surrender followed pressure from shareholders. Until the end of last week Mr Esser had been insisting that he would only agree a deal if Mannesmann shareholders were granted 52 per cent of a combined company. "We had the impression that a large number of the shareholders would prefer for us to reach an agreement with Vodafone AirTouch," Mr Esser told a press conference in Dsseldorf. It appeared that institutional shareholders were won over by the logic of the deal. Mr Esser will pay a high personal price for bowing to the demands of shareholders. He will be an executive director on Vodafone's board only until the summer and then become a non-executive deputy chairman. Mr Gent's and Mr Esser's handshake last night capped a day of high drama. As rumours grew that the two companies had agreed takeover terms, bringing to an end a three-month battle, some Mannesmann advisers continued to argue that Mr Esser would not agree to a deal that gave Mannesmann shareholders a minority stake in a merged group. "He can't do that - he is not authorised, and he's sworn to us that he would not," said one. Other advisers to the German group began to circulate documents highlighting the leap in the company's share price over the course of the bid. Announcement of the deal had been held up by employee representatives on the supervisory board seeking assurances from Vodafone. The meeting was then suspended until Friday. Vodafone's victory marks the first time a foreign company has succeeded with a hostile assault on a large German group. It demonstrates that there are no longer any no-go areas as European business embarks on a widescale restructuring. One investment banking adviser to Vodafone said: "Germany's hitherto unbreachable corporate world has finally been broken and many are going to be licking their lips." Many had expected Mr Esser to seek the support of the German government to defend Mannesmann's independence, and on Thursday night the US investment community was lining up to applaud how Mr Esser had handled the bid process. "This is good for Germany, great news for Europe," said one fund manager. Provided Mannesmann's supervisory board approves the deal, as expected, Vodafone - at œ228bn - will emerge from the takeover as Europe's largest publicly-traded company and the world's largest telecoms group. It will also rank as the fourth largest company in any industry behind Microsoft, General Electric and Cisco Systems. As the undisputed champion of the European telecoms sector, it will also stand at the centre of the continent's wireless-internet revolution. With personal computer use much lower than in the US, the mobile phone is seen as the key method by which Europeans will come to access the internet. The merger will create a global giant to compete with NTT DoCoMo of Japan, WorldCom and AT&T in the US, and Germany's Deutsche Telekom. The takeover also looks likely to set new records in investment banking. But the deal's significance lies more in the impact it seems likely to have on the mindset of chief executives at US and European companies.