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Eurobites: Vodafone Slows Revenue Decline in Europe

Also in today's EMEA regional roundup: EE becomes Europe's largest 4G operator; TeliaSonera gets clearance on Tele2 Norway acquisition; MTS downgraded.

  • Vodafone Group plc (NYSE: VOD) managed to arrest the decline of its European service revenues in its fiscal third quarter, with organic service revenues down 2.7% year-on-year to ₤6.62 billion (US$10.1 billion) compared with a drop of 5% in the second quarter. Mainland Europe is still a problem area for the operator, with revenues still on the slide in Germany, Italy and Spain, though in the UK revenue was up 0.9%. It's a brighter picture in Vodafone's AMAP (Africa, Middle East and Asia Pacific) region, where organic services revenues were up 5.9%. In a statement, CEO Vittorio Colao claimed that Vodafone's Project Spring program was "well advanced," with 65% 4G coverage in Europe and a 0.64% reduction in dropped call rates. (See Eurobites: Vodafone Plans Triple-Play in UK and Vodafone Ups 'Project Spring' Capex to $11B+.)

  • UK mobile joint venture EE , which is in the throes of being bought by BT for £12.5 billion ($19.1 billion), has underlined its attractiveness as an acquisition target in its full-year results, with EBITDA inching up 1% year-on-year to £1.58 billion ($2.41 billion) and its 4G base reaching 7.7 million customers, making it, it says, Europe's largest 4G operator. Tablet tariffs are proving increasingly popular, recording a 68% growth in uptake year-on-year. (See BT Locks Down £12.5B EE Takeover Deal.)

  • Telia Company has received approval of its proposed acquisition of rival Tele2 AB (Nasdaq: TLTO)'s Norwegian operations from the Norwegian Competition Authority. But before the approval was granted, the enterprise value of the deal had to be reduced from 5.1 billion Swedish kronor ($615 million) to SEK4.5 billion ($543 million). (See Tele2 gets green light to sell Norwegian unit to TeliaSonera.)

  • Russian operator Mobile TeleSystems OJSC (MTS) (NYSE: MBT), which is facing challenging trading conditions in a domestic market hit by economic sanctions, has had its credit rating downgraded by Standard & Poor's, from "BBB-" to "BB+" following the downgrade of Russia's sovereign rating along the same lines. (See MTS Braced for Ruble Trouble.)

    — Paul Rainford, Assistant Editor, Europe, Light Reading

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