Vodafone would do well to dispose of its assets in China and France, according to Merrill Lynch analysts cited by the Financial Times.
Selling out of China Mobile and SFR would “crystallise value, reduce indebtedness and highlight management’s…
Vodafone would do well to dispose of its assets in China and France, according to Merrill Lynch analysts cited by the Financial Times.
Selling out of China Mobile and SFR would “crystallise value, reduce indebtedness and highlight management’s willingness to actively manage the portfolio”.
In 2008, when the UK based mobile giant reshuffled its management according to regional lines, it indicated that the focus would be on organic growth rather than acquisitions.
The analysts wrote that a dramatic shift from acquisition mode to disposals would take the company from a policy of “value destruction to expected value realisation”.
A sale of its 3.2% stake in China Mobile, for example, would free up some US$6bn that Vodafone could use to pursue spectrum auctions in Germany and India, also allowing room to cut back on debt. The analysts thought that selling part, but not all, of its 44% shareholding in SFR would make sense. Vivendi owns the remainder.
A spokesperson for Vodafone declined comment, adding however that any M&A carried out would adhere to strict guidelines and in pursuance of shareholder value.