Activist shareholder Cevian Capital reportedly built up a stake in Vodafone Group in a bid to encourage sweeping changes at the UK-headquartered operator and drive up its underperforming share price.
Describing Cevian Capital as Europe’s largest activist fund, Financial Times reported the company is putting pressure on Vodafone to restructure its portfolio, improve its strategy in key markets and refresh its board.
The size of Cevian Capital’s stake has not been disclosed, but FT stated it had been talking to Vodafone’s management for several months and is particularly keen to see the operator take a more active role in driving consolidation in markets such as Italy, Spain and the UK.
This ambition certainly chimes with recent comments by Vodafone CEO Nick Read, who has called for consolidation between players in Europe to help the industry return to growth.
Reuters previously reported Vodafone is in discussions with Iliad Group over a merger of their operations in Italy. The UK-based operator also apparently explored a possible deal to merge its domestic business with CK Hutchison-owned 3 UK, although a deal never materialised.
Furthermore, Deutsche Telekom reportedly held talks with Vodafone and Orange regarding potential tower tie-ups.
Open RAN boost
News of Cevian Capital’s involvement was welcomed by analysts and investors, and pushed Vodafone’s share price up 4 per cent in early trading today (31 January).
The figure may also have been influenced by news Vodafone teamed up with Intel and other chip makers to design its own architecture for open RAN.
Vodafone CTO Johan Wibergh announced on LinkedIn a new R&D centre “dedicated to the development of microchip architecture for open RAN” had opened at the company’s new digital skills hub in Spain, which became operational today.
“We have 50 people working on open RAN and they will join the 650 employees also based at the hub. Around 20 vendors specialising in chip architecture design and development will also join us,” Wibergh said.
Wibergh did not name the vendors, but Reuters said Intel, Qualcomm, Broadcom and Lime Microsystems have joined the project.
Vodafone UK recently activated what it claimed as the first 5G open RAN site in the country.
