Vodafone share price: Company ready to invest in independent Openreach

on Jul 27, 2015
Updated: Oct 21, 2019

Vodafone Group Plc (LON:VOD) is prepared to invest in any new company which would own the UK’s largest telephone and broadband network, the mobile carrier’ chief executive officer, Vittorio Colao, has said. The mobile phone giant is one of several telecoms firms calling for the break up BT Group Plc (LON:BT.A) by splitting its Openreach infrastructure division into a separate company. Rival players such as Vodafone claim that this is required in order to ensure that all internet service providers are given equal access to its network. The matter is currently being examined by Ofcom as part of the watchdog’s strategic review of Britain’s digital communications sector.

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“We would be prepared to put equity in a vehicle that could deliver fibre to us and also other companies, whether it is an independent Openreach or a similar vehicle,” Colao told reporters at Vodafone’s first-quarter trading update on Friday.
The mobile carrier has attempted a similar approach in Italy, where it teamed up with rival Wind in offering to acquire a stake in the partly state-owned fibre-optic company Metroweb. Vodafone’s idea is to use Metroweb as a vehicle for a shared national fibre infrastructure in Italy. According to Colao this approach could also be applied to the UK. A condition for Vodafone’s investment in a national broadband company would be that all internet providers are given equal access to the network.

“It’s better to share, and compete at the service level, rather than all build in the same areas,” he said, as quoted by the Guardian.
In today’s trading, Vodafone shares were 1.1 percent lower at 235.90p, as of13:45 BST. The stock has risen nearly six percent since the start of the year and the company’s market capitalisation currently stands at £62.2 billion.
The 23 analysts offering 12 month price targets for Vodafone have a median target of 250.00p, with a high estimate of 300.00p and a low estimate of 130.00p.
As of 15:26 BST, Monday, 27 July, Vodafone Group plc share price is 235.80p.


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