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Vodafone grabs $4.3B Eircell
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December 21, 2000: 9:46 a.m. ET
British cell-phone company to buy Irish counterpart Eircell
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LONDON (CNNfn) - Vodafone Group PLC agreed Thursday to buy Ireland's leading cell-phone operator Eircell for  4.5 billion ($4.1 billion) in stock, plus debt.
The world's largest wireless operator is buying Eircell from former Irish telecoms monopoly eircom PLC, and will assume Eircell's borrowings of 250 million.
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 EIRCELL FACTBOX
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Eircell has 1.23 million subscribers
Controls 60 percent of the market
About 1 million text messages are sent daily across its network
Revenue rose to 484 million euros in 2000 from 343 million a year ago
Pretax profit jumped to 57 million euros from 31 million euros in 1999
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The 4.5 billion deal caps an expensive week for Vodafone, which paid $2.2 billion for a 15 percent holding in Japan Telecom on Wednesday.
The acquisition extends Vodafone's rivalry with British Telecommunications PLC, which also has a stake in Japan Telecom. BT owns 51 percent of Esat Digifone, Eircell's only current competitor in the Irish market.
Eircom, which was privatized in July 1999, is selling the cell-phone business to focus on its fixed-line and Internet operations. Separately Thursday, the company rejected a $1.9 billion approach for its fixed-line assets from telecom entrepreneur Denis O'Brien, saying the offerl undervalued its business.
Vodafone is "adding more than 1.2 million customers to its base, in an attractive mobile market with a high proportion of young people and a fast growing population," Vodafone Europe Chief Executive Julian Horn-Smith said in a statement.
About one in two people in Ireland own a mobile phone and Eircell has a 60 percent share of the market.
Eircell will be demerged from eircom into a new company called Eircell 2000 PLC. Eircom shareholders will receive one share in this new company for every eircom share they own. Vodafone will then exchange 0.95 of its shares for every two Eircell 2000 shares. KPN Telecom of the Netherlands, which owns 21 percent of Eircom, stands to receive 875 million for its stake.
Shares in Vodafone (VOD) fell 4 percent 235 pence in London, Eircom dropped 5 percent 2.70 in Dublin.
--from staff and wire reports 
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