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

To: MrGreenJeans who wrote (3137)	5/16/2001 8:05:13 AM
From: MrGreenJeans	Read Replies (1) \| Respond to of 3175

Solutions Emerge in Talks on Arcor HB/sms BERLIN. Handelsblatt has learned that talks between U.K. mobile-phone giant Vodafone PLC and railways operator Deutsche Bahn AG have produced a number of potentially promising solutions to the dispute over the future of fixed-network telecommunications operator Arcor. Arcor was founded in 1997 by Mannesmann AG after it had acquired a majority stake in DB-Kom, the Deutsche Bahn communications network. Mannesmann has since been taken over by Vodafone, which is now Arcor's majority shareholder. Deutsche Bahn holds 18%, and Deutsche Bank 8%. Under Arcor's present shareholder structure, Deutsche Bahn's stake is strong enough to give it a blocking minority in the company. But Vodafone wants to float Arcor's shares on the stock market, and in preparation for this move, Arcor will have to assume AG (or public limited company) status. Once it has done this, Deutsche Bahn will lose its power of veto. Arcor's planned IPO is aimed at making it easier for the company to make acquisitions. But Deutsche Bahn chief Hartmut Mehdorn has on several occasions made it plain that he has reservations about allowing his company's telecommunications interests to pass into the hands of other companies. His reasons are to be found in the technological upgrade undergone by Deutsche Bahn's equipment as part of Mehdorn's much-vaunted "restructuring offensive". The current security system with its fixed signalling points is to be replaced by wireless technology based on a form of the GSMR standard specially developed to meet the needs of the railways. Since November of last year, Deutsche Bahn has been in talks with Vodafone. In return for its approval of the conversion to AG status, Deutsche Bahn wants to take back all of the technical installations that are specific to its business. Handelsblatt has learned that a number of possible solutions are currently under discussion. One provides for the spin-off of the railways-specific infrastructure into a separate company, to be managed by both Arcor and Deutsche Bahn. Another provides for the transfer of ownership of the railways-specific technology to Deutsche Bahn, while leaving the operations in Arcor's hands. Officially, both sides declined to comment.