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Mannesmann bid soon?
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November 11, 1999: 3:51 a.m. ET
Report: Vodafone hostile bid likely, UK firm fears offer from MCI, Sprint
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LONDON (CNNfn) - U.K. mobile-phone operator Vodafone AirTouch has intensified its efforts to launch a hostile takeover for German rival Mannesmann, according to a press report Thursday.
Continued speculation of a bid for Mannesmann boosted the stock 7 percent Wednesday, and the Wall Street Journal reported Thursday that Vodafone is speeding up its plans for Mannesmann to ward off a possible counter-bid from U.S. giants such as MCI WorldCom (WCOM) or SBC Communications (SBC).
A deal could come as early as next week, according to the newspaper, and would value Mannesmann, Germany's largest cellular operator, at more than $100 billion. The newspaper cited unnamed people familiar with the situation.
The Journal reported that Vodafone's offer would include domestic rival Orange (ORA), which is in the process of being acquired by Mannesmann (FMMN) in a $36 billion deal.
Speculation of a deal has boosted Mannesmann's stock by almost a fifth in the last month, although some investors criticized the takeover of Orange as overpriced and called it a defensive move, to avoid a takeover by the likes of Vodafone.
Hurdles to a deal between the companies include voting restrictions on Mannesmann's stock and certain antitrust disapproval if Vodafone gets its hands on one of the other three U.K. cellular licenses. Unconfirmed reports recently have indicated Vodafone may already have lined up an agreement for France Telecom (PFTE) to buy Orange.
A takeover of Mannesmann would make Vodafone Europe's dominant cellular player. It already has minority holdings in Mannesmann's two most prized assets: the D2 network in Germany (35 percent-owned by Vodafone) and Italy's second-largest cellular player, Omnitel (22 percent-owned by Vodafone). Consolidating these holdings with Mannesmann's majority stakes would give Vodafone unique pan-European coverage.
None of the companies involved would comment on the report.
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