Vodafone CEO Vittorio Colao's comments that the operator has "beautiful assets" made amusing headlines, but Colao was also making a serious point: while his focus is on expanding the company's networks, Colao said he would be open to a buyer if they were interested enough.
"We have a strategy and we are putting a lot of money into it, but if somebody comes and says, 'You have really beautiful assets,' then I will agree," Colao said at the Morgan Stanley Technology, Media & Telecom Conference in Barcelona, Bloomberg reported. "We have beautiful assets."
There are ongoing rumours that AT&T is putting together a deal to buy the UK-based group, which has just raked in $130 billion (€96.6 billion) from the sale of its 45 per cent stake in Verizon Wireless to Verizon Communications. Vodafone has so far refused to comment on the AT&T rumours, and is meanwhile stepping up its "Project Spring" network investment programme that was announced after the completion of the Verizon deal.
The company now plans to invest £7 billion ($11.3 billion or €8.4 billion) over two years in improving its mobile networks and strengthening its convergence and emerging market strategies. According to Reuters, Vodafone could be open to higher network spending even after this two-year period is over. Colao said at the conference that he could keep spending higher or reduce it, depending on how his competitors respond.
"It is, if you want, a big tap that we can open and close to some extent," Colao said, referring to the company's future investment levels. Vodafone usually spends around £6 billion per year on its network assets.
Vodafone's intention to increase its capital expenditures is certainly a welcome boost to the telecoms market's struggling vendors, as highlighted by Ericsson, which said Vodafone's plan to boost investments in infrastructure is a boon to the industry, according to Bloomberg.
Ericsson, which is already a network equipment supplier to Vodafone, is encouraged to see the carrier's plan to invest more than £19 billion ($30.7 billion) on its networks by 2016, Ericsson CFO Jan Frykhammar said at the same conference, Bloomberg reported. The equipment and services supplier is "heavily engaged" with Vodafone, Frykhammar said.
"If we are able to win the right footprint when companies like Vodafone modernize their network, that is good for us," he said. "If they upgrade and continue with the same vendor, that should also be good."
"It would be fantastic if we could get to, let's say, half of the dynamics that we have experienced in the U.S. market," Frykhammar added, according to Reuters. "(Then) it will be fun to be a vendor and an investor in Europe. But we are not there yet."
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