Liberty Global has acquired 4.92% of the share capital in Vodafone Group PLC at a cost of £225 million.
In a statement, the company said the transaction had been funded through non-recourse financing, requiring equity funding from Liberty Global.
Mike Fries, CEO of Liberty Global, commented, “We believe, like many others, that Vodafone’s current share price does not reflect the underlying long-term value of their operating businesses, or their announced consolidation and infrastructure opportunities. We continue to remain disciplined about our capital and fully expect that the equity used to fund this investment will be replenished with the sale of certain non-core assets over time.”
The investment doesn’t require any regulatory approval and Liberty has confirmed it is not intending to seek any board representation.
Liberty holds an investment portfolio of more than 75 companies and funds across content, technology, and infrastructure, including stakes in companies such as ITV, Televisa Univision, AtlasEdge, Plume, and the Formula E racing series.
This particular deal is made interesting because of Liberty’s market-by-market choice of partners. In the Netherlands, the partnership is with Vodafone itself in VodafoneZiggo while in the UK the tie-up is with the Spanish operator Telefonica in Virgin Media O2.
Earlier this year, Vodafone ousted chief executive officer Nick Read after Cevian Capital, Coast Capital and French billionaire Xavier Niel built stakes in the company. Xavier Niel is the founder and majority shareholder of French Internet service provider and mobile operator Iliad known as Free.
Liberty Global has confirmed it is not considering an offer for Vodafone.
