Vodafone Ends Talks to Swap Phone Assets With Liberty Global

28 Sep 2015 | Author: | No comments yet »

Vodafone Ends Talks to Swap Phone Assets With Liberty Global.

Vodafone and Liberty International, the US owner of Virgin Media, have ended talks about a possible exchange of assets, the UK mobile phone operator said. Vodafone said in June it was considering swapping some businesses with Liberty, Europe’s biggest cable company, a move that would enable the groups to sell the packages of mobile, fixed-line, broadband and television increasingly offered by rivals.

Vodafone, the world’s second-largest mobile-phone company, announced the termination of discussions in a statement Monday, almost four months after disclosing the talks. People familiar with the matter said at the time the companies were discussing a range of potential transactions including an asset swap, combining their western European businesses, or an outright merger. Vodafone denied that the talks included the option of a merger but analysts said the UK firm could have raised £30bn by selling its operations in Africa, the Middle East and Asia-Pacific to make a merger with Liberty possible.

Mobile phone operators and other communications companies are jostling for position as the once distinct worlds of telephones, television and broadband are pulled together by technological advances. With assets from the U.K. to India and Africa, Vodafone is looking to reduce its reliance on a business that has suffered from a fierce price war in Europe. For Liberty Global, a deal with Vodafone would have deepened a shift in strategy at a media company that until recently has shied away from owning wireless networks. “It’s good news that Vodafone is not sucked into a swap of assets — I was never convinced that there was real value for shareholders in that scenario,” said Paul Marsch, an analyst at Berenberg Bank in London. “We can never rule out a future deal, but for real value to be created it has to be a full-blown merger on a nil-premium basis where both sets of shareholders get upside from the significant synergies.” A deal between the companies would have reshaped Europe’s telecommunications and cable industries and also attracted antitrust scrutiny. This month, the executive who leads Deutsche Telekom AG’s German unit said the company would oppose a merger of Liberty Global and Vodafone in its home country.

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