Vodafone completes sale of Spanish unit

The sale, priced at €4.1 billion in cash and €0.9 billion in the form of redeemable preference shares, was announced last October, and got approved by Spanish regulators earlier this month. Zegona today described it as ‘the largest ever reverse takeover.’

Vodafone and Zegona have also entered into an agreement whereby Vodafone will provide services to Vodafone Spain after completion of the transaction, and Vodafone will continue to have a presence in Spain through its Innovation Hub in Málaga, Vodafone said in a brief statement.

Eamonn O’Hare, Zegona’s Chairman and CEO said in its release: "We have now completed the acquisition of Vodafone Spain and look forward to transforming the business and returning it to growth. I am pleased to welcome José Miguel García to lead Vodafone Spain as CEO, reuniting a team that has a proven track record of highly successful operational transformations in Spanish telecoms.

“The new 10-year network access agreement signed with Finetwork earlier this week demonstrates our ability to move swiftly on our well-defined strategy. With our proven track record, we are confident we will improve the performance of Vodafone Spain whilst delivering significant value for shareholders.”

The fate of Vodafone’s Spanish unit has been up in the air for a while – in 2021 it reportedly held merger talks with MasMovil in 2021, but lost out to Orange. Vodafone apparently then hired advisors to help it decide what to do in Spain, and in September Zegona emerged as a likely buyer.

“The sale of Vodafone Spain is a key step in right-sizing our portfolio for growth and will enable us to focus our resources in markets with sustainable structures and sufficient local scale,” said Margherita Della Valle, Chief Executive of Vodafone at the time of the deal’s announcement. “I would like to thank our entire team in Spain for their dedication to our customers and relentless determination to improve our organic performance. However, the market has been challenging with structurally low returns.

In terms of the new management, with effect from 1 June 2024 José Miguel García will be CEO of Vodafone Spain, previously holding CEO positions at Jazztel and Euskaltel, and the senior management team has also been ‘significantly restructured and simplified’ with four new hires and the overall headcount has been reduced from 11 to 7.