Vodafone has signed an agreement to sell its Spanish operations for up to €5 billion to Zegona Communications, an investment firm based in the United Kingdom.
Vodafone will receive at least €4.1 billion in cash and up to €900 million "in the form of Redeemable Preference Shares (“RPS”) which redeem, for an amount comprising the subscription price and accrued preferential dividend," six years after closing, at the latest.
According to the Chief Executive of Vodafone, Margherita Della Valle, “The sale of Vodafone Spain is a key step in right-sizing our portfolio for growth and will enable us to focus our resources in markets with sustainable structures and sufficient local scale. I would like to thank our entire team in Spain for their dedication to our customers and relentless determination to improve our organic performance. However, the market has been challenging with structurally low returns."
"My priority is to create value through growth and improved returns. Following the recently announced transaction in the UK, Spain is the second of our larger markets in Europe where we are taking action to improve the Group’s competitiveness and growth prospects,” she added.
Vodafone and Zegona will enter into a brand license agreement that will allow the Vodafone brand to be used in Spain for up to ten years after completion. They will also have other transitional and long-term arrangements for services including access to procurement, Internet of Things (IoT), roaming and carrier services.
Vodafone recently expanded its research and development center in Malaga, Spain, where it is working on the rapid development of new platforms for 5G Open Radio Access Networks (Open RAN) using the ARM architecture.
