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EDITIONS
Wednesday, 6 November, 2002, 13:39 GMT
Vodafone in fresh Cegetel bid
SFR logo
Buying Cegetel would give Vodafone control of French mobile firm SFR
UK mobile telecoms firm Vodafone has renewed its offer for media conglomerate Vivendi's 44% stake in French mobile operator Cegetel.

Vodafone has pitched its latest bid at 6.7bn euros, the same price as its original offer, which was rejected as too low by Vivendi last week.

"We have renewed our offer because we continue to believe that Vodafone is the natural home for Cegetel, and that it would be in the best interests of all parties," said Vodafone chief executive Chris Gent.

The British mobile firm is keen to take control of Cegetel, which would give it a prized stake in France's second-biggest mobile company, SFR.

France is one of the few European countries where Vodafone does not yet have a major presence.

Buying spree

Vodafone is also trying to buy minority stakes in Cegetel held by former UK telecoms monopoly BT and US telephone firm SBC Communications.

But Vivendi, weighed down by massive debts, is reluctant to sell Cegetel, one of its few profitable and cash-rich businesses.

An additional reason for holding onto Cegetel is that without it, Vivendi's main interests would be in the US entertainment media sector, making it difficult for the firm to maintain its French identity.

Under a shareholder agreement, Vivendi has the right to match Vodafone' s bid for BT's Cegetel shares, and offer SBC a 13% premium over Vodafone's offer for its stake.

Tensions

But the cash-strapped media giant is unlikely to be able to launch a counterbid without the cooperation of its lending banks.

Vivendi is also under pressure from some investors to sell its Cegetel stake in order to pay back some of its borrowings.

Vodafone played upon these tensions on Wednesday, saying that its renewed offer provided Vivendi with the opportunity to raise some sorely-needed cash.

"Our offer provides the board of Vivendi and its stakeholders with a clear choice either to sell its Cegetel interests at an attractive price in cash and immediately reduce its debt, or to pre-empt," Mr Gent said.

Vodafone shares were off 0.75p at 106p in afternoon trade.


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