Carol Morris Law

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e& increases Vodafone stake amid scrutiny of board structure

United Arab Emirates funding group e& has elevated its stake in Vodafone to 14.6 per cent and has mentioned the composition of its non-executive board, because the British telecoms firm battles to persuade buyers it’s on a path to enhancing its stuttering efficiency.

The group, previously often known as Etisalat and rebranded e&, has been regularly growing its stake in Vodafone since Could final yr, when it acquired 9.8 per cent for round $4.4bn. 

However a weak efficiency in key markets reminiscent of Germany, and the exit of Vodafone’s chief govt Nick Learn on the finish of final yr, has precipitated a 25 per cent decline within the firm’s share value since then.

e&’s discussions with administration are the primary indication that Vodafone’s largest shareholder could also be sad with enterprise selections or has sought to encourage modifications.

The British telecoms group has been below renewed strain after US telecoms group Liberty World constructed a 5 per cent stake within the firm, saying there have been “attention-grabbing catalysts” for worth creation.

In September final yr, French telecoms tycoon Xavier Niel additionally introduced he had purchased 2.5 per cent of the corporate by his funding firm Atlas Investissement.

e& stated in a regulatory submitting late on Monday night that it had selected April 12 that it was in its greatest curiosity, and one of the best curiosity of Vodafone, “for e& and its representatives to have the ability to interact with [Vodafone] and its representatives on quite a lot of subjects, together with subjects for which e& could also be deemed to be in search of to affect the issuer”. 

It stated that on the identical date it had initiated preliminary dialogue in regards to the “non-executive composition” of Vodafone’s board of administrators.

When the Abu Dhabi-listed telecoms supplier first constructed a ten per cent stake in Vodafone, it stated it deliberate to be a long-term shareholder and was supportive of its board.

State-controlled e& is eager to remodel itself right into a expertise firm and to develop globally past the 16 nations throughout the Center East and Africa the place it has about 160mn subscribers.

Vodafone has sought to introduce extra heft to its board for the reason that begin of 2022 when it got here below fireplace from activist investor Cevian Capital for not having sufficient non-executive administrators with telecoms expertise.

It has since added Stephen Carter, chief govt of Informa who served as the primary chief govt of Ofcom, and Delphine Ernotte Cunci, president of French nationwide public tv broadcaster France Télévisions.

Its different appointments over the previous yr have extra of a background in expertise and gold mining.

Former chief govt Learn stepped down on the finish of final yr. He has been changed on an interim foundation by Margherita Della Valle, Vodafone’s chief monetary officer.

Vodafone declined to remark. e& didn’t instantly reply to a request for remark.


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