September 8, 2010
Vodafone nets £4.2 billion in China Mobile sale
Vodafone has sold its 3.2 per cent stake in China's biggest phone operator, China Mobile, pocketing £4.2 billion in the process.
The sale marked the biggest off-loading of non-strategic investments by a UK-based phone company. The buyer, or buyers, have not been identified.
The 643 million shares were snapped up after being listed on the Hong Kong stock exchange at a 3.4 per cent discount to the market price.
Vodafone put the stake up for sale in a bid to race proceeds that will be put to use paying off the group's net debt. Approximately 30 per cent will be used for this purpose, while the remaining 70 per cent will be returned to shareholders through the buying back of shares.
Vodafone, which is headquartered in Newbury, Berkshire, made its original investment in China Mobile in 2000. The company said they could continue to work with China Mobile in areas including network roadmap development, roaming, green technology and multinational customers.
The telephone company's chief executive, Vittorio Colao, said, "Today's transaction achieves a near doubling of Vodafone's original investment in China Mobile and combines our stated portfolio strategy with ongoing co-operation with China's leading telecommunications company."