Stay up to date with notifications from The Independent

Notifications can be managed in browser preferences.

Outlook: Dear diary, we're winning the mobile bid battle

Friday 24 December 1999 00:02 GMT
Comments

Your support helps us to tell the story

From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.

At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.

The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.

Your support makes all the difference.

ONE GLANCE at the astronomic fees Vodafone AirTouch is paying its advisers on the Mannesmann bid explains how Goldman Sachs came to top the European M&A rankings this year. Once upon a time pounds 400m would have been sufficient to acquire a decent-sized company. These days it is barely enough to pay off the investment banks, lawyers and financial PRs once the meter starts running.

Nevertheless, the 46-page offer document that all these bloated fees helped produce is a nifty piece of work. The chronology at the front, detailing how regularly Vodafone and Mannesmann have met up to discuss merger possibilities in the last year, does not exactly help the Germans' case for remaining independent.

Chris Gent's frequent Dear Diary entries, going back to last January, also make it obvious that a bid for Mannesmann was not a knee-jerk reaction to the Germans' acquisition of Orange but part of a thought-out strategy.

The posting of the offer document marks the official start of hostilities and, for the first time, Vodafone is on the front foot. Thus far its performance has been stumbling. It failed to anticipate the degree of political and union opposition in Germany. It antagonised Brussels by declaring that its bid was not conditional on European Commission clearance. It also put a spanner in the Government's timetable for auctioning off third-generation mobile licences.

However, Vodafone has so far managed not to alienate what ought to be the most important constituent in this takeover battle - Mannesmann's shareholders. The narrowing of the gap between the value of Vodafone's offer and Mannesmann's market price, points in the direction of victory for Mr Gent.

He is also helped by Germany's poorly constructed takeover code. This means that most shareholders won't get to read the long list of health warnings contained in the 460-pages of listing particulars. Nor will they need to bother their heads with Vodafone's vague plan about how to deal with Orange, once the takeover is completed.

This being Germany, however, Mr Gent may still be none the wiser as to who is the victor come day 46. The political pressure on Brussels to pack the deal off for a four-month investigation will be intense. Vodafone could yet squeeze around that by sweetening its offer with some cash and gaining a recommendation from the Mannesmann board. But it may be too late for that.

Join our commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in