Vodafone offers €2.1bn to draw line under Kabel Deutschland dispute

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Vodafone Group PLC (LON:VOD) has offered more than €2bn to buy out the minority shareholders in Kabel Deutschland (KDG) to settle a legal dispute that has been running since 2013.

The UK telecoms giant has been battling hedge fund groups Elliott Advisors, DE Shaw and others ever since it acquired 77% of Germany’s largest cable group in 2013 for €7.7bn.

Elliott and the other minority shareholders claimed the amount paid was too low and challenged the valuation of KDG shares in the run-up to the deal.

Vodafone has now moved to settle the dispute with a tender offer for the outstanding minority of the KDG shares worth €103 per share or €2.12bn in total.

Elliott, DE Shaw and UBS O’Connor, which combined speak for 17.1% of KDG shares, have agreed to the offer and also to drop their legal action relating to the takeover.

Elliott has also agreed to other conditions, one of which is not to take further legal action against Vodafone.

Following the completion of the offer, Vodafone will own at least 93.8% of the outstanding share capital of KDG.

Vodafone noted that the cost of the put option arrangement established with the minority shareholders in 2013 was now significantly higher than its borrowing costs. 

The FTSE 100 group added that its debt will rise to €46.1bn if all the KDG minorities tender their shares.

Shares in Vodafone eased 0.4% to 121.5p.

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