London The Emirati company Etisalat has acquired a 9.8 percent stake in Vodafone as part of its global expansion. The state-controlled group said on Saturday that it wanted to keep the $ 4.4 million stake in the British company for the long term and was not interested in taking over any other Vodafone shares.
Etisalat will thus become the Group’s largest single shareholder ahead of US asset managers Blackrock and Vanguard and the British bank HSBC. The move comes at a time when Cevian, Europe’s largest activist investor, is pressing Vodafone to consolidate its European business, divest from divisions and improve returns.
Like its big neighbor and competitor Saudi Arabia, the Emirates are trying to prepare their economy for a time after oil revenues. Both Opec countries are investing their assets in growing industries outside the country, such as e-mobility or semiconductors. “The investment was a unique opportunity to acquire a significant stake in a leading and globally strong telecommunications brand,” Etisalat CEO Hatem Dowidar said in a statement.
Last Wednesday, it became known that Vodafone is pushing ahead with the consolidation of the domestic mobile market. The telecommunications group has started negotiations on a merger of its British business with Three UK, the “Financial Times” reported, citing people familiar with the matter. Further details of the potential deal were not immediately available.
Vodafone Group chief executive Nick Read said in February that the company was seeking mergers with rivals in several European markets. Three UK is owned by Hong Kong-based CK Hutchison.
In mid-April, it was announced that Philippe Rogge, who currently heads Microsoft’s Eastern Europe business, will become the new head of Vodafone Germany. On July 1, Rogge will replace the current CEO Hannes Ametsreiter, who has led the British telecommunications group’s highest-revenue subsidiary since October 2015.
