First deal since its sale of 45% stake in Verizon Wireless to Verizon.
British telecoms firm Vodafone has acquired the Spanish cable firm Ono in a $10bn deal, marking its first big deal since its sale of stake in Verizon Wireless worth $130bn to Verizon.
Ono has the largest network in Spain serving approximately 7.2 million homes released to marketing serving 1.9 million customers in 13 of Spain’s 17 regions providing high speed broadband, and pay-TV service.
Expected to help Vodafone to compete with Spain’s Telefónica in offering high-speed broadband, the company also expects to achieve cost and capex synergies approximately €2bn after integration costs.
Vodafone also expects to accelerate growth in unified communications products and services by using Ono’s extensive distribution and marketing capabilities and through cross-selling to each company’s customer base.
Vodafone Group chief executive Vittorio Colao said the combination of Vodafone and Ono creates a leading integrated communications provider in Spain and represents an attractive value creation opportunity for Vodafone.
"Demand for unified communications products and services has increased significantly over the last few years in Spain, and this transaction – together with our fibre-to-the-home build programme – will accelerate our ability to offer best-in-class propositions in the Spanish market,"Colao said.
As part of the deal, UK telecom firm would assume Ono’s €3.34bn debt and shell out the balance in cash to Ono’s shareholders, who are directed by a US investment funding groups.
Chairman of Ono Board of Directors Jose´ Mari´a Castellano Ri´os said, "As part of Vodafone, Ono will continue to seize new growth opportunities and deliver the quality that our customers expect. The enlarged business is also expected to drive innovation in the Spanish telecommunications industry."
The British telecoms firm, which acquired German Kabel Deutschland in 2013, is adding up landline services to pay off for fading wireless revenue.
Competing with Telefonica and Orange, Ono added 9,000 Internet consumers and 183,000 mobile subscriptions during Q4 while losing 17,000 TV customers.