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Vodafone has agreed to acquire Tele2 Italy and Tele2 Spain for €775M in cash

October 8, 2007

1 Min Read

NEWBURY, U.K. -- Vodafone announces today that it has agreed to acquire Tele2 Italia SpA (“Tele2 Italy”) and Tele2 Telecommunication Services SLU (“Tele2 Spain”) from Tele2 AB Group for a cash consideration of €775 million (£537 million) on a debt free basis.

Tele2 Italy and Tele2 Spain provide nationwide fixed-line telecommunications and broadband services. Tele2 Italy had over 2.6 million customers as at 30 June 2007, including over 400,000 broadband customers, Tele2 Spain had 550,000 customers as at 30 June 2007, including over 240,000 broadband customers.

Key highlights of the transaction are:

  • Enables Vodafone to benefit from the attractive, high growth broadband markets in Spain and Italy, as penetration is increasing rapidly

  • Immediately delivers the infrastructure and broadband expertise necessary for a competitive broadband offering in two of Vodafone’s key European markets

  • Capital expenditure requirements of Tele2 Italy and Tele2 Spain are not expected to materially impact the Group’s ongoing capital intensity ratio in its Europe region

  • Meets Vodafone’s stated financial investment criteria and is expected to be broadly neutral to adjusted earnings per share in the first full year after acquisition, excluding the impact of acquired intangible asset amortisation

Commenting on the transaction, Arun Sarin, Chief Executive of Vodafone, said: "This acquisition is consistent with our strategy of meeting our customers’ total communications needs. It will generate substantial time to market benefits in Italy and Spain, where low broadband penetration and the market structure make ownership of fixed broadband assets attractive. We have now established a clear route to delivering fixed broadband services in each of our major European markets."

Vodafone Group plc (NYSE: VOD)

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