Vodafone lines up white knight in bid for Kabel Deutschland

Vodafone is said to be lining up a 'white knight' to back its rumoured bid for Germany's largest cable operator Kabel Deutschland.

Vodafone is said to be lining up a 'white knight' to back its rumoured bid for Germany's largest cable operator Kabel Deutschland.

The telecommunications company is expected to present an offer as early as this week after Kabel revealed on Wednesday it doubled its net profits to €200m for the nine-months to December 31st.

Vodafone is working to boost its business after reporting a worse than expected 1.8% decline in group revenues of £11.38bn for the last three months of 2012, blaming difficult market conditions in Europe.

A deal with Kabel could help revive the struggling business, according to analyst Ishaq Siddiqi who said he was not surprised to hear the latest reports Vodafone was lining up a white knight in a potentially "hostile bid".

"It could get to a point where we see governments get involved," he told Sharecast.

Vodafone would need clearance from competition regulators who have blocked cable mergers over concerns about higher prices for consumers.

In market chatter Tuesday, Vodafone was understood to have hired Goldman Sachs to advise on options while Kabel retained Morgan Stanley and advisory firm Perella Weinberg to defend its interests in the event of an approach.

Siddiqi said an agreement will depend on how much money Vodafone was willing to put behind its offer for Kabel, which raised its dividend by 67% to €2.50.

"Kabel is in a pretty good position for premium offer," he said.

Shares in Kabel fell 1.57% to €66.93 at 11:04 while Vodafone dropped 1.42% to 160.20p.

RD

Recommended

The top funds to invest in
Funds

The top funds to invest in

As market volatility and recessionary fears continue, here are the most popular funds, stocks and trusts investors are putting their money into
2 Mar 2023
The ten highest dividend yields in the FTSE 100
Income investing

The ten highest dividend yields in the FTSE 100

Rupert Hargreaves takes a look at the companies with the highest dividend yields in the UK’s blue-chip index
27 Feb 2023
The outlook for Shell shares is mixed, despite bumper profits
Energy stocks

The outlook for Shell shares is mixed, despite bumper profits

With profits surging, it looks as if Shell is on a roll, but the company’s growth from here is hard to see as Rupert Hargreaves explains.
6 Feb 2023
The top ten dividend stocks in the FTSE 250
Share tips

The top ten dividend stocks in the FTSE 250

The average FTSE 250 dividend yield is around 4%, but many stocks yield much more. Rupert Hargreaves picks the best FTSE 250 stocks for income investo…
17 Jan 2023

Most Popular

Government plans could see NS&I boost interest rates
Savings

Government plans could see NS&I boost interest rates

The government-backed bank has a new funding target, which could prompt it to boost the rates on its Premium Bonds, ISAs and bonds.
16 Mar 2023
Share tips of the week – 17 March
Investments

Share tips of the week – 17 March

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages
10 Mar 2023
Will energy prices go down in 2023?
Personal finance

Will energy prices go down in 2023?

As energy prices slide, the government has now extend its energy bill support from April. But what will you bills look like later this year? We have a…
15 Mar 2023