Thursday, February 16, 2023

Is Liberty Global Investment in Vodafone Anything More than a Good Investment?

Liberty Global has purchased a five-percent stake in Vodafone, but says the investment is not a first step towards a takeover. Some might find the investment odd in some ways: Liberty owns half of Virgin Media O2, a major Vodafone rival in the United Kingdom. 


It is not immediately clear whether that will be the case longer term, some point out, but Liberty often buys minority stakes in firms without seeking control. More so than for most companies, Liberty Global is interested in making money, not “control.”


Liberty Global long has had a policy of taking minority stakes in a wide variety of companies--some 75 or so at the moment--across content, technology, and infrastructure, including stakes in ITV, Televisa Univision, AtlasEdge, Plume, and the Formula E racing series.


But the buy might simply be “opportunistic,” as Liberty Global executives say, a bet on a higher stock price once restructuring deals happen. Hostile intent is not an obvious driver. 


Vodafone and Liberty are partners in owning Ziggo in the Netherlands and Vodafone purchased Liberty Global assets in Germany, Hungary, Romania and the Czech Republic in 2019.




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