Vodafone’s latest deal has called up a clever defence against predators

 

OUTLOOK: Dialling up a deal is Vodafone’s signature talent, and has been so under successive chief executives. The latest, unveiled by the incumbent Vittorio Colao, is the purchase of Spanish cable TV operator Ono and it’s taken quite a phone bill to get done.

He’s paid €7.2bn (£6bn) for the business, about €1bn more than the initial indications. But what’s a few free phone calls between friends?

That still puts the price in the realm of analysts’ estimates, but the multiple of Ono’s earnings is a frothy one, even after the considerable cost and revenue synergies Mr Colao says he can extract.

All the same this deal, following hot on the heels of year’s takeout of cable operator Kabel Deutschland, could prove worth the outlay on several fronts. At the most basic level it should help stabilise the company’s shaky Spanish offering, through adding high-speed broadband to the portfolio of services Vodafone offers to customers.

On a broader level it fits with a strategy being pursued by many of Europe’s telecoms giants, which want to bundle up and sell an array of services including mobile, fixed line, broadband and TV.

But what’s most interesting is the tactical component of the transaction, which utilises some of the vast proceeds from Vodafone’s sale of its US joint venture to its partner Verizon.

There have been suggestions that this acquisition, and the one in Germany, might make Vodafone less attractive to its most likely predator, US giant AT&T.

The poison pill as a defence against predators is frowned upon these days, at least here in the UK – and Ono isn’t that. But it might just make Vodafone harder to swallow by the time AT&T has served the six months in purdah demanded by the Takeover Panel after it kiboshed widespread speculation of an imminent bid.

The City loves deals and a takeout of Vodafone would be the deal to end all deals and could generate the fees to end all fees.

But longer term shareholders might welcome this particular phone bill. They’ve already received a fat payout from one dollar deal in the form of a special dividend. Do they really need another? After all, where would fund managers put the money? Royal Bank of Scotland? Or some of those natural resource giants from former Soviet states?

The obvious reaction to that from any sane pension fund? Ono, ono, ono! Quick, get on the phone to Vodafone’s investor relations: we want more deals like this. We’ll back them, whatever the bill.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Software Development Manager

£40000 - £50000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee