Tuesday, 19 June 2012

Vodafone wins over CWW shareholders.

Vodafone @ 176.65p, +1.75p (+1%)

Looks like Vodafone's opportunistic £1bn bid for CWW is set to go through following a last minute change of heart by CWW's largest investor, Orbis with 19%, reversed its opposition and voted in favour of the deal to avoid a lengthy period of uncertainty.

This despite their view that the bid price of 38p per share undervalues the group's prospects and assets which current management has failed to capitalise on given the company's debt.

Of the 78.7% of CWW shareholders that voted, 99.1% voted in favour, so thats an overall 77.99% of shareholders in favour.
Which is above the 75% necessary to approve the deal under the scheme of arrangement.

27th July looks to be the "binding" point of no return date.

The acquisition is seen as a positive move for Vodafone as it brings an established Corporate Services business which the company will integrate with its own, and the second largest fixed line network in the UK which will provide additional data carrying capacity that the company currently rents from the likes of BT.

I hold Vodafone for its yield and exposure to US markets through its minority 45% holding in Verizon Wireless (Investment update: Vodafone results y/e 31 March 2012).

Related articles:
- http://in.reuters.com: UPDATE 4-Vodafone closes in on $1.6 bln CWW network deal
- http://www.heraldscotland.com: Vodafone wins support for its £1bn takeover of CWW
- http://www.telegraph.co.uk: C&W Worldwide investors back £1bn Vodafone bid

Related posts:
Investment update: Vodafone results y/e 31 March 2012
May 2012: Portfolio Update.

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