Source: Sharecast
Under the terms of the deal, E&’s 16.21% holding has been priced at 112.5p per share, a 15% premium to Thursday’s closing price of 97.76p.
E& first acquired a position in the blue chip telecoms operator in 2022 before gradually expanding its position. In a brief statement, Vodafone confirmed that the relationship with E& had been terminated, and that Hatem Dowidar, its nominated director, had resigned from the board with immediate effect.
The sale will make French telecoms tycoon Niel - who already owns a 2.5% stake in the British business through his investment vehicle Atlas Investissement - Vodafone’s biggest shareholder.
Niel said: "Vodafone is a compelling investment opportunity, underpinned by quality assets, strong brands, leadership positions and a diversified geographic footprint.
"We are confident Vodafone can deliver sustainable growth and strong cash flow generation over the long term, and - as an anchor investor based in Europe - we are ready to contribute our deep sector expertise and operational know-how to its future success." Niel is acquiring the stake through his Vega entity.
The founder and majority shareholder of French internet provider and mobile operator Iliad, Niel holds interests in telecoms companies across Europe, as well as co-owning Le Monde newspaper.
E& said the exit was a "natural evolution" of its priorities, as it refocuses on its core businesses and unlocks cash from the sale.
As at 1030 BST, the stock had soared to the top of the FTSE 100 leaders board after putting on 11% at 108.7p.
Dan Coatsworth, head of markets at AJ Bell, said: “The market has responded favourably to Niel’s latest purchase, with certain investors believing he might want to buy the whole of Vodafone in time. That might not be the case, but it won’t stop market speculation."
However, he cautioned: "Two years ago, the UK government said E&’s investment posted a national security risk to the country. The investment wasn’t blocked, but national security safeguards were imposed. It’s possible the government will have similar concerns with Niel’s latest purchase, giving it investigated Patrick Drahi’s [2024] investment in BT Group on national security grounds. After all, both Vodafone and BT are providers of essential services to businesses and consumers."
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