Telecoms trade

Abu Dhabi firm Etisalat swoops on Vodafone shares

Vodafone is in talks with Three

Abu Dhabi telecoms giant Etisalat has snapped up almost 10% of Vodafone in a £3.6 billion swoop on the FTSE 100 company’s shares. 

The trade makes Etisalat the biggest shareholder in Vodafone and comes just days after it emerged that it is in talks to combine its UK arm with rival Three, uniting Britain’s third and fourth largest mobile networks. 

Government-controlled Etisalat, also known as e&, said the 9.8% stake gave it significant exposure to a world leader in connectivity and digital services.

In a statement, Etisalat boss Hatem Dowidar said: “We see this as an investment for e& and its shareholders as it will allow us to enhance and develop our international portfolio.’

Etisalat said it would be a long-term investor and had “no intention to make an offer” to buy Vodafone. Under UK takeover rules this pledge restricts it from making a bid for six months.

However, analysts say its move adds to pressure on chief executive Nick Read to deliver on his restructuring of the business. He will reveal the company’s annual results on Tuesday.

Vodafone’s stock is expected to surge when the market opens on Monday as Etisalat paid around £1.30 per share, compared with the closing price on Friday of £1.18. 

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