Vodafone Mannessmann Essay

1528 Words7 Pages
MACR – Vodafone Airtouch’s Bid for Mannesmann Submitted by Dhruv V Suri B12080 Case Summary The case revolves around Vodafone’s hostile bid for Mannesmann, the German telecommunication company. The hostile bid was because the two firms differed on the valuation of Mannesmann and how a merger between Vodafone and Mannesmann will benefit the shareholders. The case unfolds the story which led to the hostile bid and how the partnership between the two telecommunication giants soured. Vodafone Touch was based in UK and was in 1999, the largest mobile company in the world. With operations in 24 countries and population footprint of 960 million people, it wanted to enter the internet and fixed lines business. It pursued Mannesmann as it thought that the merger would benefit the combined entity, however the activities of Mannesmann thwarted this move. Mannesmann was partners with Vodafone in some telecom circles, however it entered into direct competition with Vodafone by raising a bid for Orange in October 1999. Orange was one of the last mobile companies in UK which was not part of any large telecommunications group. Vodafone made attempts to attract Mannesmann to discuss the merits of a merger. However, on the day of the scheduled meeting, the Mannesmann CEO Esser cancelled the meeting as he had already signed a deal with Orange. The Orange deal was signed on October 20 and the deal valued Orange at 20 billion pounds. After this acquisition of Orange, Vodafone AirTouch was not in a position to reorient itself in the German market. The souring of the relations between the two companies also made the designs of Vodafone in Italy & France difficult. The Hostile Bid The CEO of Vodafone Gent hired Goldman Sachs as their investment bankers and on November 19, 1999 Vodafone launched a formal hostile bid for Mannesmann at an offer of 53.7 Vodafone Shares for every Mannesmann

More about Vodafone Mannessmann Essay

Open Document