Vodafone bids £8bn for control of France's SFR

The mobile phone operator Vodafone launched a €13.07bn (£8.27bn) offer yesterday for the shares it does not already own in the French telecoms group Cegetel, owner of the country's second biggest mobile network SFR.

But Vodafone admitted that fellow shareholder in Cegetel, Vivendi Universal, could still spoil the deal.

Vodafone, which already owns 15 per cent of Cegetel, has agreed to pay BT €4bn for its 26 per cent stake and SBC Communications of the US €2.3bn for its 15 per cent holding.

It has also made a €6.77bn cash offer for Vivendi's 44 per cent share, which remains open until 30 October, but admitted that the French company had the right under a previous shareholder agreement to buy the BT and/or SBC stakes.

"How confident are we [that Vivendi won't spoil the party]? They [Vivendi] haven't discussed with us what they could do and they now have a series of options to make decisions on. We'll be interested to find out what they wish to do over the next couple of weeks," Sir Christopher Gent, Vodafone's chief executive, said.

"But if they [Vivendi] decided to accept our offer, they'd put their liquidity issues behind them and that's quite an important issue," he stressed.

Sir Christopher refused to comment on whether Vivendi might accept Vodafone's offer but insisted the company would not be pushed into paying more than was already on the table.

"We've made an offer to Vivendi ... if they come back and pre-empt then so be it, that's their right. We're not in the game of bidding higher."

If Vodafone's offer for BT's and SBC's stakes is accepted, the mobile phone operator will increase its stake in Cegetel to 56 per cent and will see its economic interest in SFR rise to 64.5 per cent from 31.9 per cent.

Vivendi has until 10 November to make an offer for the BT and SBC stakes in Cegetel and must offer SBC a 13 per cent premium to the Vodafone price.

While analysts deemed a move by Vivendi for both those shareholdings unlikely, they were concerned Vodafone might have trouble winning management control of Cegetel even if it held both the BT and SBC stakes. Sir Christopher insisted, however, that "the company which has majority economic interest, has the right to appoint the majority of directors and from there you gain management control."

He said the deal would be the last of Vodafone's major acquisitions for the time being.