UPDATE Vodafone Group (NASDAQ: VOD), based in London, announced that it has entered into a binding agreement to sell Vodafone Italy to Swisscom for an enterprise value of $8.7 billion. The transaction follows an extended period of engagement with several counterparties to explore market consolidation options in Italy, Inside Towers reported.
The transaction values Vodafone Italy at a multiple of 7.6x consensus Adjusted EBITDAaL for FY2024, representing a premium to the Group’s trading multiple. Moreover, the deal provides Vodafone Group with a full exit from Italy, where the company found that it was not possible to achieve a return on capital employed in excess of cost of capital. The transaction is conditional on certain regulatory approvals, including clearance by the Italian Competition Authority, although it is not conditional on the approval of Swisscom’s shareholders.
As part of the transaction, Vodafone Group and Swisscom have agreed that Vodafone will continue to provide certain Group services to Swisscom for up to five years for an annual charge of approximately $380 million. Swisscom operates Italy’s second-biggest telecom, Fastweb, according to Inside Towers Intelligence, and will combine those operations with Vodafone Italy.
Vodafone Group and Swisscom are also exploring a closer commercial relationship to enable collaboration across a broad range of areas, beyond Italy, according to the company’s release.
The key areas of commercial collaboration being considered include IoT, enterprise services and solutions, procurement, operational shared services and roaming. This activity is aligned with Vodafone Group’s strategy to commercialize its shared operations and broaden its partnerships.
By John Celentano, Inside Towers Business Editor
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