Tags: vodafone | vivendi | telecommunications | sfr | mobile | europe | acquisition

Vivendi to Purchase Vodafone Stake in SFR

Sunday, 03 Apr 2011 05:12 PM

Vivendi SA agreed to buy Vodafone Group Plc.’s 44 percent stake in mobile-phone operator SFR for 7.95 billion euros ($11.3 billion), giving the French company full control of its largest unit.

The purchase price includes 200 million euros in SFR dividends paid to Vodafone, Paris-based Vivendi said in an e- mailed statement Sunday. In addition, SFR and Vodafone will continue their commercial cooperation for the next three years, Vivendi said.

The price represents 6.2 times SFR’s 2010 earnings before interest, taxes, depreciation and amortization, Vivendi said. In the last three years, the average multiple paid for western European telecommunications assets was 6.4 times Ebitda, according to data compiled by Bloomberg.

The transaction will “will create a significant increase in Vivendi’s adjusted net income, enabling us to raise the dividend to our shareholders,” Vivendi Chief Executive Officer Jean-Bernard Levy said in the statement.

SFR accounted for about 43 percent of Vivendi’s total sales last year. For Vodafone, the SFR sale is the third major disposal of a minority asset by CEO Vittorio Colao, after the company sold its 3.2 percent stake in China Mobile Ltd. last September for $6.5 billion, and a 3.1 billion-pound ($5 billion) interest in Japan’s Softbank Corp. in November.

Vivendi gained cash for an SFR deal in January after receiving a $3.8 billion payment from General Electric Co. for its former 20 percent stake in NBC Universal entertainment group. The company received a $2 billion transfer in September.

Selling the SFR stake now also gives Vodafone a chance to make a deal before the entry of a fourth operator complicates the French mobile-phone market.

Iliad SA, a discount broadband provider, is planning to start a mobile-phone service called Free Mobile in 2012 and has pledged to bring down prices in a country where charges for phone services are higher than in other European countries, according to the Organisation for Economic Co-operation and Development.

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Vivendi SA agreed to buy Vodafone Group Plc. s 44 percent stake in mobile-phone operator SFR for 7.95 billion euros ($11.3 billion), giving the French company full control of its largest unit.The purchase price includes 200 million euros in SFR dividends paid to Vodafone,...
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2011-12-03
Sunday, 03 Apr 2011 05:12 PM
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