Vodafone to pay up to $2.6 bln to end German legal fight (updated)
22/12/2020 08:04
* Tender offer to buy out minority shareholders at 103
euros/share
* Receives acceptances from shareholders representing 17.1%
* Elliott, other accepting shareholders to withdraw court
appeal
(Adds analyst comment, background, shares)
By Yadarisa Shabong
Dec 22 (Reuters) - Vodafone VOD.L on Tuesday offered more
than 2 billion euros ($2.5 billion) to buy out Kabel
Deutschland's KD8Gn.H minority shareholders and end a
long-running legal battle over the cable company with hedge fund
Elliott and others.
The British telecoms group, which bought close to a 77%
stake in the German cable company in 2013 for 7.7 billion euros,
offered all minority shareholders 103 euros in cash for each
outstanding share.
Citi analyst Georgios Ierodiaconou said the tender offer was
not a surprise and that was a reasonable price and would help to
eliminate one of the potential risks to the group.
Vodafone said shareholders representing 17% of the shares
had accepted the offer, which valued all remaining minority
holdings in KDG at up to 2.12 billion euros.
Elliott, D.E. Shaw and UBS O'Connor have accepted the offer
and agreed not to take further legal action against Vodafone,
the statement added.
KDG minority shareholders had previously appealed against a
2019 decision by a Munich court that ruled Vodafone's
compensation for the 2013 takeover as adequate.
Vodafone, the world's second-largest mobile operator, said
its net debt would rise to 46.1 billion euros if all shares were
tendered. Shares in the FTSE 100 firm were down 1% by 1210 GMT.
The group on Monday ended talks with the Saudi Telecom
Company 7010.SE over the $2.4 billion sale of its shareholding
in Vodafone Egypt VODE.CA , reaffirming its commitment to the
country. urn:newsml:reuters.com:*:nL1N2J10BU
Vodafone is spinning out its mobile network towers to take
advantage of investor appetite for infrastructure assets, which
offer a long-term secured income stream. It will use the
proceeds to reduce its debt. urn:newsml:reuters.com:*:nL8N2IS07Z
Last month, Vodafone hiked its earnings outlook after a
resilient first half, despite a hit to roaming revenue from
coronavirus-led travel curbs. urn:newsml:reuters.com:*:nL8N2I21DM
($1 = 0.8173 euros)
(Reporting by Yadarisa Shabong in Bengaluru
Editing by Patrick Graham and Keith Weir)
((Yadarisa.Shabong@thomsonreuters.com; Twitter: https://twitter.com/Yadarisa;
+919742735150;))