Liberty Global and Vodafone going Dutch
Vodafone Group is in talks with Liberty Global over the creation of a joint venture in the Netherlands that would incorporate both companies' local businesses.
The discussions don't extend beyond the Netherlands, Vodafone said in a statement Tuesday in response to a Bloomberg News report that the companies had resumed talks on partnerships.
There is no certainty that a deal will be agreed, the company said.
Vodafone shares dropped 1pc to 223.10 pence at 2.10pm yesterday in London, after earlier rising as much as 3.4pc.
Shares of Royal KPN, the biggest telephone operator in the Netherlands, fell as much as 3.4pc yesterday.
A spokesman for Liberty Global declined to comment. Vodafone and Liberty Global resumed talks this year about possible asset swaps in Europe after scrapping deliberations involving some of their biggest markets last year, sources said.
The Netherlands, like Ireland, is just one territory where Vodafone operates a large mobile business and Liberty owns cable TV assets.
But the Dutch assets are the focus of the current talks. Liberty is interested in expanding in the country and may make an offer for Deutsche Telekom's local mobile unit if the negotiations with Vodafone don't lead to an agreement, a source said.
Previous talks between Vodafone and Liberty ended in September after the companies couldn't agree on the value of UK and German operations, two of the largest markets for both, a person familiar with the matter said at the time.
Cable TV billionaire John Malone, Liberty's chairman, has said that while the companies' assets would fit well together in Europe, philosophical differences on dividends and expansion will make a combination difficult.
Liberty Global and Vodafone together have more than $80bn in annual revenue and about $115bn in combined market capitalisation.
Asset swaps could see Vodafone gain TV and broadband businesses. (Bloomberg)