Xavier Niel to become top Vodafone shareholder

Vega, an acquisition vehicle owned by the Niel family group, has agreed to acquire Emirates Telecommunications Group’s entire approximately 16.21% shareholding in Vodafone Group. The binding agreement covers about 3.944 billion Vodafone shares at a price of 112.5 pence per share, giving the deal an overall value of around £4.44 billion, or about $5.96 billion and €5.1 billion.

The per-share price of 112.5 pence includes cash and a future dividend as part of the consideration package. Reports described this price as representing a 15% premium to Vodafone’s last closing share price, and the announcement was followed by a sharp rise in Vodafone’s shares and a strong move in UK equity markets.

The transaction transfers the entire holding previously owned by Emirates Telecommunications Group, also known as e&, which first invested in Vodafone in 2022. With this single deal, the stake moves in full to Vega, a vehicle created specifically to house the investment.

Once completed, the acquisition will make French telecoms billionaire Xavier Niel, via Vega, the largest shareholder in Vodafone. Vega has framed the purchase as a long-term, strategic minority shareholding rather than a step toward full control of the company.

In line with this position, Vega has issued a notification under the UK Takeover Code stating that it does not intend to make an offer for the entire share capital of Vodafone. The vehicle has nevertheless reserved certain rights in specified circumstances, as permitted under the code, while stressing its role as a minority investor.

Vega has also said it will initiate contact with the UK government regarding the proposed investment and will work constructively with relevant authorities. Physical settlement of the shares is expected after required regulatory approvals are obtained, with completion anticipated by year end.

Vodafone has confirmed that e& has agreed to dispose of its entire shareholding to Vega. As a result, the relationship agreement previously in place between Vodafone and e& has been terminated, ending the formal strategic link between the two companies.

In conjunction with the exit, e&’s nominee director, Hatem Dowidar, has stepped down from Vodafone’s board. This removes e&’s direct role in Vodafone’s governance and paves the way for Vega, as the new largest shareholder, to define its own engagement with the company and its stakeholders.

Vega has stated that the investment will be financed by Xavier Niel and financial institutions, with no recourse to entities controlled by the Niel family group. This financing structure underlines the use of Vega as a dedicated vehicle for holding the Vodafone stake, separate from other family-controlled businesses.