UK mobile operator Vodafone confirmed in a statement last night that it sold its 3.2% stake in China Mobile for £4.3bn (US$6.5bn). Vodafone’s 642.87 million shares in the Chinese company were placed on the Hong Kong stock exchange and offered at 3.4%…
UK mobile operator Vodafone confirmed in a statement last night that it sold its 3.2% stake in China Mobile for £4.3bn (US$6.5bn). Vodafone’s 642.87 million shares in the Chinese company were placed on the Hong Kong stock exchange and offered at 3.4% discount to the market price.
Goldman Sachs, Morgan Stanley and UBS are acting as lead managers and bookrunners on the transaction.
CEO Vittorio Colao said in the statement that “today’s transaction achieves a near doubling of Vodafone’s original investment in China Mobile and combines our stated portfolio strategy with ongoing cooperation with China’s leading telecommunications company.” Vodafone had originally purchased the stake in two transactions between 2000 and 2002 for £2.1bn.
But the company said it would continue to cooperate with China Mobile in various areas including roaming, network roadmap development, multinational customers and green technology.
Following the sale, Vodafone said it will begin a share buy-back scheme for 70% of the proceeds. The rest will be used to pay down the British group’s debt.
Over the last few months, Vodafone has reportedly been looking to offload several minority investments in foreign companies in order to calm investors. The latter publicly lambasted the company’s international expansion strategy as “value destructive” and called for replacement of chairman Sir John Bond.
