Vodafone Sells SFR Stake to Vivendi for £7 Billion

Vodafone has sold its 44 percent stake in French phone company SFR for nearly £7 billion.

After months of talks, Vodafone has sold its 44 percent stake in SFR to Vivendi, a French media conglomerate that counts Universal Music Group and 57 percent of Activision Blizzard as part of its portfolio. The cash deal awards Vivendi full control of SFR and Vodafone plans to use £4bn (€4.5bn) of the net proceeds in a share buy-back scheduled for sometime after June. The remainder of the proceeds will be used to reduce the Vodafone Group’s net debt.

The deal is still subject to the usual regulatory approvals but is expected to pass through the red-tape process fairly quickly and close in the second quarter of this year. Speaking of the deal, Vodafone Chief Executive Vittorio Colao said his company remains committed to "realising maxiumum value from [its] non-controlled assets."

"The sale of our stake in SFR, at an attractive multiple, represents a significant further step in the execution of this strategy," he said. "In addition, we have secured a valuable partnership agreement in France which will allow us to continue to deliver compelling cross-border services to both consumer and enterprise customers across the major markets of western Europe.

"By returning £4bn to our shareholders, we are increasing our current buy-back programme to £6.8bn in total, equivalent to over 7 percent of Vodafone's current market capitalisation."