Thoughts on an AT&T Vodafone Bid: A Powerful Vision with Many Hurdles

Brian Washburn
Brian Washburn

Summary Bullets:

  • The AT&T blueprint for acquiring Vodafone lines up neatly, but undercurrent factors are going to be a challenge.
  • AT&T’s bold vision for a Vodafone acquisition is commendable, but it’s not clear why Vodafone would cooperate.

In our day jobs, we analysts tend to rein in speculation based on rumor, and instead address more immediate, concrete issues. But when media sources break a story like AT&T’s reportedly building a case to bid for global wireless giant Vodafone, it’s too tempting to pass up. The pieces for the business case fall neatly into place. For a while now, AT&T reportedly has been on the lookout for wireless partners abroad. Vodafone is finally unraveling its Verizon Wireless stake, clearing a potential conflict-of-interest issue. Vodafone is not tied to national interests that could quickly scuttle a deal (see America Movil’s recent rejected bid of KPN). AT&T might ease financing an acquisition by tapping the pile of cash Vodafone inherits after unraveling of the Verizon Wireless stake. AT&T could sell Vodafone operations in Africa/Middle East, Russia/CIS, Asia and Latin America to partners, to defray the costs further and make the acquisition more affordable. Continue reading “Thoughts on an AT&T Vodafone Bid: A Powerful Vision with Many Hurdles”

América Móvil’s KPN Interest: Sweep MNC Visions Aside, It’s About the Mobile Subscribers

Brian Washburn
Brian Washburn

Summary Bullets:

  • It is tempting, but probably wrong, to expect América Móvil’s bid for KPN to have a global MNC angle.
  • América Móvil’s track record shows preference for mobile subscribers; KPN’s divesting E-Plus with Telefónica likely spurred the proposed takeover.

Billionaire tycoon Carlos Slim Helú is known for making bold moves with strategic investments.  When Carlos Slim-owned América Móvil increased its investments in KPN and Telekom Austria in 2012 by investing billions of euros, the strategic business synergy seemed obvious. When it comes to serving multinational corporations (MNCs), América Móvil and Telefónica are rivals throughout Latin America.  Both competitors can go cross-border into North America easily enough, to extend services across North America. Continue reading “América Móvil’s KPN Interest: Sweep MNC Visions Aside, It’s About the Mobile Subscribers”