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Vodafone looking to sell off large stake in its £12bn phone masts division

Powerful response: A sale would allow chief executive Nick Read to reduce the company's huge debt load

Vodafone is seeking to sell a large stake in its £12billion telephone antennae division in what could be one of the biggest stock market deals this year

Powerful response: A sale would allow chief executive Nick Read to reduce the company's huge debt load

Powerful response: A sale would allow chief executive Nick Read to reduce the company’s huge debt load

Vodafone is seeking to sell a large stake in its £12billion telephone mast division in what could be one of the biggest deals on the stock exchange this year.

A sale would allow chief executive Nick Read to reduce the company’s huge debt load, which stands at around £36billion.

It would also be a powerful riposte to activist investors who have criticized its performance and want to see radical change at the FTSE100 giant.

Vodafone listed its mast business, Vantage Towers, on the Frankfurt Stock Exchange last year.

The most likely scenario is a “co-control” deal under which he would sell half of his 82% stake, likely to a private buyer.

That would allow it to take £2.2bn of Vantage debt off its balance sheet and bring in more than £6bn in cash, analysts at City Bernstein say. That could add 13.2p to the share price, currently at £1.08, Bernstein said.

There is no timetable, but a deal could happen before the end of the year. Potential buyers include US buyout barons KKR, Global Infrastructure Partners and Swedish investment firm EQT.

Read has streamlined his rambling global empire to focus on key European markets, including the UK. He recently agreed to sell the Hungarian business for £1.6bn and has previously sold operations in Malta, Qatar and New Zealand.

Offloading a multi-billion pound stake in Vantage would eclipse those deals. It could also help appease Read’s critics, including activist investor Cevian, who thinks he’s moving too slowly.

Another potential thorn in Read’s side emerged last week when French billionaire Xavier Niel bought 2.5% of Vodafone through one of his investment funds.

Read, who took the helm in 2018, has come under pressure to turn the tide after years of disappointing share price performance.

Initially, he had hoped to merge Vantage with the mast division of Deutsche Telekom, but the German operator ended up striking a deal with Canadian and American buyers.

As well as the Vantage Towers deal, there has been speculation of a merger between Vodafone’s UK operations and mobile operator Three UK.

It looks like Read wants to grow the company’s Internet of Things business and there are suggestions he could part ways with African mobile money service M-Pesa.

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