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Vodafone Completely Acquires Arcor

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May 19, 2008

Vodafone Completely Acquires Arcor



By Anshu Shrivastava
TMCnet Contributing Editor


Vodafone (News - Alert) today said that it has agreed to acquire the 26.4 percent stake in Arcor AG & Co. KG (Arcor) that it does not already own for a cash consideration of €474 million.

 
The U.K based telecommunications giant is buying the stake from Deutsche Bahn AG and Deutsche Bank AG.
 
The company said that with full ownership of Arcor—an alternative fixed-line carrier in Germany with 2.6 million DSL lines, reportedly representing 14 percent market share—it continues to execute on its strategy of meeting the total telecommunication needs of its customers.
 
This acquisition of Arcor is expected to enable Vodafone Germany to exploit potential synergies available from fixed-mobile integration. In addition, it will also help the Vodafone to participate effectively in the continued rapid development of the German broadband market, which is growing at just under 30 percent per annum, according to company’s officials.
 
Arcor is an alternative fixed-line carrier in Germany, and through its own nationwide voice and data network, it uses the latest technologies to offer both corporate and residential clients a full spectrum of services for voice and data transfer.
 
Arcor has an advanced fixed network in Germany, which includes more than 33,000 km of optical fibre cabling, 2,600 local exchanges, providing approximately 60 percent population coverage in more than 800 cities and towns.
 
Recently, the company added more customer offerings such as digital TV as well as IP-based and managed services for business customers.
 
Arun Sarin (News - Alert), CEO at Vodafone, said that this deal is consistent with his company’s total communications strategy.
 
“By taking full control of Arcor and aligning it more closely with Vodafone Germany we will leverage the greater scale this presents, and generate synergies and substantial time to market benefits within Europe’s largest telecommunications market,” he added.
 
Vodafone stated that the transaction meets its stated financial criteria and is broadly neutral to adjusted earnings per share from the date of the acquisition.
 
“There are no outstanding conditions to the acquisition and it will therefore be completed today,” according to the company.
 
Anshu Shrivastava is a contributing editor for TMCnet. To see more of her articles, please visit her columnist page.


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