Investors gain nothing in a Vodafone breakup – Vodacom chair

Separation of Vodafone’s EM assets to help pave the way for a Liberty Global deal mooted.
A mooted separation of Vodafone Group Plc’s emerging-market assets to help pave the way for a deal with Liberty Global Plc will bring little value for shareholders of the U.K. mobile-phone company’s African business, according to the Johannesburg-based unit’s chairman.
Europe’s biggest wireless carrier is locked in a stalemate with the cable company after months of negotiating an exchange or combination of assets. Vodafone would likely explore a spinoff of its operations in the Middle East, Africa and Asia if an agreement could be reached with Liberty Global on their European businesses, people familiar with the matter have said.

“I don’t know in what way splitting it will actually create any value for our shareholders,” said Peter Moyo, chairman of Vodacom Group Ltd., the Vodafone unit that generates more than $7 billion in annual revenue in Africa. “I’m not too sure in what way it will assist. None of the shareholders are clamoring for it. None of them are actually putting any pressure on us to push for it.”

In a phone interview on Thursday, the chairman said he was involved in discussions about the possibility of a separation of Vodafone’s so-called AMAP business with shareholders in the U.K., U.S. and South Africa, although he hasn’t discussed the matter with Vodafone. The U.K. company owns 65% of Vodacom, which has customers in Mozambique, Tanzania, Lesotho and the Democratic Republic of Congo as well as South Africa. The AMAP division, which also includes countries from Egypt to Turkey and India to Australia, is led by Serpil Timuray.

Investors “mentioned that they believe that this might be a possibility, but they’ve not been urging us to do something about it,” Moyo said. “Vodacom is a very big contributor and it’s fair to say that Vodafone really loves Vodacom. I will be surprised if they are thinking of spinning us off.”

Vodacom has more than 63 million customers and is the market leader in South Africa. Sales rose 7% to R19.6 billion last quarter, driven by international data sales. Vodafone also owns about 40% of Nairobi-based Safaricom Ltd., Kenya’s biggest wireless carrier.

Vodacom shares have gained 9.5% this year, compared with a 2.7% decline in London-listed Vodafone. The African unit has market value of $15.7 billion, compared with almost $90 billion at Vodafone.

©2015 Bloomberg News

COMMENTS   0

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Podcasts

Instrument Details  

You do not have any portfolios, please create one here.
You do not have an alert portfolio, please create one here.
INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us: