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Vodafone to raise stake in Cegetel
LONDON, England -- Mobile phone giant Vodafone said on Wednesday it had agreed with BT Group and SBC Communications to buy their stakes in France's Cegetel in a 6.3 billion euros ($6.2 billion) cash deal. In a complicated deal, Europe's biggest mobile phone operator will gain 56 percent control of the French telecommunications group and SFR, the mobile company 80 percent owned by Cegetel. Vodafone already owns 15 percent of Cegetel and 20 percent of SFR, France's second biggest mobile phone operator. The London-based group will pay 4 billion euros ($3.9 billion) for BT's 26-percent stake in Cegetel and $2.27 billion for the 15-percent interest held by SBC, the U.S. telecommunications group. Vodafone also said it had made a cash offer of 6.77 billion euros to Vivendi Universal for its 44-percent stake in Cegetel. The offer expires on October 30. Cash-strapped Vivendi has said it would consider a bid from Vodafone but could decide to increase its own holding in Cegetel. The Paris-based media giant has "pre-emption" rights to block the Vodafone bid for the shares held by BT and SBC and present a counter offer by November 10. "The outcome is that we will have a voting control [of Cegetel] if Vivendi does not pre-empt," a Vodafone spokeswoman told Reuters. Vodafone is anxious to expand in France, the only European market where it does not have a controlling interest in domestic mobile phone operations. "Vodafone has wanted to get control in France for a very long time, and frankly we think it unlikely that Vivendi will stop them," John Tysoe, an analyst at WestLB Panmure, told Reuters. "For Vivendi, 6.8 billion [euros] in the hand is better than 1.6 billion annually [in SFR cash flow]." Vodafone (VOD) was down 4.2 percent to 96.34 pence and BT (BT) was 3.3 percent lower at 174 pence in mid-afternoon London trading on Wednesday. Vivendi (PEX) shares were up 7.4 percent to 14.42 euros in Paris.
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