Vodafone snaps up European operations for €18bn

Vodafone snaps up European operations for €18bn

Vodafone snaps up European operations for €18bn

Vodafone Group PLC is now in an agreement to buy Liberty Global's businesses in four European countries in a deal worth almost $23 billion, a merger set to create one of the largest telecommunications carriers in the continent.

The move will see the United Kingdom telco buy businesses in Germany, Hungary, Romania and the Czech Republic and will see it bolster its cable TV, broadband internet and mobile services in the region.

Once complete, Liberty Global will remain the region's largest cable TV and broadband provider with its assets in the U.K., Ireland, Belgium, Switzerland, Poland and Slovakia reaching 24 million homes.

Vodafone says the transaction will turn it into Europe's "leading next generation network owner", with 54 million cable/fiber homes "on-net" and a total reach of 110 million homes and businesses.

"This transaction will create the first truly converged pan-European champion of competition", said Vodafone chief executive Vittorio Colao.

Mike Fries, Chief Executive Officer of Liberty Global, said that the deal values its operations at a double digit multiple.

Pending approval by European Commission regulators, the deal is projected to close in mid-2019.

"In Germany, there is no geographic overlap between Vodafone's cable network and Unitymedia's cable network; the two companies operate their cable businesses in different parts of the country, and serve different customers".

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The deal transforms Vodafone's fixed line and convergence strategy in key CEE markets, complementing Vodafone's existing mobile operations in the Czech Republic, Hungary and Romania.

The purchase is set to make Vodafone a serious competitor to Deutsche Telekom in the European communications market. The company also owns half of VodafoneZiggo in the Netherlands, which has 4 million customers.

"I do not see that this kind of concentration in the cable market can be supported from regulatory bodies", he reportedly said.

In a statement issued to DTVE today, a spokesperson from Deutsche Telekom said: "Quite a number of stakeholders in Germany have already voiced their concerns".

"It's clear that the transaction would create a monopoly in cable content distribution and a de facto duopoly in fixed-line infrastructure in Germany", Markus Haas said. "We share this view".

Wilson added: "The much-rumoured bid for ITV could be on the cards although Liberty may in fact be minded to go after o2 ahead of its much-rumoured stock market listing".

Telefonica and Deutsche Telekom have criticized Vodafone's $21.8 billion deal to buy Liberty Global operations in continental Europe, Reuters reported. The Bonn-based company employs more than 217,000 employees across the world and recorded total revenue of 79.4 billion euros in 2017.

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