Sarin tightens grip on Vodafone

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The Independent Online

Vodafone fired one of its leading directors yesterday as the turmoil at the mobile phone giant intensified.

The decision to oust the marketing director Peter Bamford was widely interpreted in the City as an attempt by the chief executive Arun Sarin to take firmer control of the board.

Mr Sarin's position is regarded as vulnerable due to growing investor disquiet and a series of extraordinary boardroom rows. Sir Christopher Gent, the former chief executive who built Vodafone into a global player, is also under pressure to give up his role as honorary life president.

Vodafone said yesterday that Mr Bamford will leave on 1 April after a "fundamental review" of the company strategy.

Mr Bamford, who joined the board in 1998 and is seen as a close acolyte of Sir Christopher, was responsible for the group's marketing operations. A spokesman said: "He has been given notice in accordance with his contract."

Mr Bamford was paid £1.5m last year and can expect a pay-off worth at least that, plus share options.

Vodafone said it was "simply not true" that the ousting of Mr Bamford had anything to do with boardroom infighting. "There was a review of group marketing. This decision is part of the process," a spokesman said.

Many in the City found the company's explanation unconvincing. Robert Grindle, the Vodafone analyst at Dresdner Kleinwort Wasserstein, said: "My sense is that it is related to the whole board spat. It is the remnants of the Chris Gent crew departing. In that regard, it means that Sarin's position is bolstered."

Recent high-profile departures from Vodafone include the finance director Ken Hydon and the deputy chief executive Julian Horn-Smith. The chairman Lord MacLaurin is due to step down in July, to be replaced by HSBC's Sir John Bond. There is some disquiet among investors about the £500,000 golden goodbye that Lord MacLaurin is due to receive as a retirement bonus.

According to reports, Sir Christopher voted against Mr Sarin's re-election as chief executive last summer, as the executive infighting erupted.

Some shareholders see this as Sir Christopher meddling unhelpfully in the business he built. One investor, who declined to be named, said yesterday: "What seems to be going on with Chris Gent is scandalous. He has got to go."

Customers are no longer racing to buy Vodafone products, while its shares are moribund. Yesterday they fell 1.25p to 122.5p.

Vodafone sources insist yesterday's announcement will be the last of the boardroom departures for some time, while acknowledging that pressure exists for more changes.

In late February, Vodafone said it would wipe between £23bn and £28bn of goodwill off the balance sheet, an accounting change that indicates it may have overpaid for its assets. It also said revenue from mobile phones would fall, suggesting the entire industry has peaked.

Yesterday, Mr Sarin denied the telecoms industry is a mature market. "Our industry is still very young," he said in Hanover. He is trying to sell Vodafone's Japanese arm to Softbank in a deal that could fetch £6bn.

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