Vodafone Spain has a new owner. The British fund Zegona has made official the purchase of the Spanish subsidiary for 5,000 million euros months after Margherita Della Valle, CEO of the Vodafone Group, revealed the intention to make a change in strategy in the face of the tough competition that the operator faces.
The purchase, specifically, allows Zegona make use of the Vodafone brand in Spain for at least a period of 10 years, and opens the door to new long-term agreements for some of the operator’s businesses, such as mobile roaming or Vodafone services in our country. To close the acquisition, the British group will pay 4.1 billion euros in cash to Vodafone. The operator will also finance the purchase with 900 million euros in exchange for potential Zegona shares.
Of course, although the purchase is official, both Zegona and Vodafone will have to wait for the approval of the Government of Spain to be able to finalize the agreement. The British fund expects that this decision will be carried out during the third quarter, a date on which Brussels could also approve the merger between Orange and MasMóvil.
What does Zegona intend with the purchase of Vodafone?
The purchase of Vodafone comes at a time of tough competition in the telecommunications sector in Spain. Above all, due to the future merger between Orange and MasMóvil. It also comes at the worst moment for the Spanish subsidiary, which in their latest results announced a 7% drop in income.
Zegona’s objective is, therefore, make the Spanish subsidiary grow again in the country with a change in strategy similar to that which the British fund made with Euskaltel; turn it into a successful operator before it was acquired by MasMóvil. With the purchase of Vodafone Spain by Zagona, in fact, The British fund has appointed José Miguel Garcíaformer CEO of Jazztel and after Euskaltel, head of the subsidiary.
“We are very excited about the opportunity to return to the Spanish telecommunications market. This attractive acquisition represents our third operation in Spain after the success of Telecable and Euskaltel. With our clearly defined strategy and proven track record, we are confident of creating significant value for shareholders.”
Eamonn O’Hare, CEO of Zegona.
Vodafone, for its part, hopes that the purchase and the change in strategy that Zagona is preparing will serve to once again boost its communications business in Spain, since, for the company, it is the second largest market in Europe.