Softbank Buys Vodafone Japan
Filed in archive Announcements by Editor on March 17, 2006

"It's good news. The focus will now be on what form the return of cash will take, whether it will be dividends or more share buybacks. We will press them very, very strongly to make it a special dividend," said Richard Marwood, fund manager at AXA Investment mangers.Vodafone's Japanese mobile business has been struggling for the past few years, with lower sales of 3G phones than expected and lower subscriber numbers as a result.
Marwood said the price was at the top end of what people were expecting.
Vodafone said it would incur an impairment charge of around $8.57 billion (4.9 billion pounds) in its results for the year to the end of March, 2006, as a result of the stake sale.
It added that it now expects to record an impairment charge in the second half of the year ending March 31, 2006, at the upper end of the $40.25 billion-to-$49 billion range (23 billion to 28 billion pounds) indicated on Feb. 27.
Vodafone Chief Executive Arun Sarin said the sale price was attractive and would enhance the company's adjusted earnings per share.
"It has become increasingly clear that the greatest operational benefits come from strong local and regional scale," said Sarin, adding Vodafone only wants to put capital where it can create superior returns in markets offering a strong local position.
"In the case of Japan, we have been making progress on the turnaround in recent months. However, given the relative competitive position of the business, the reduced prospects for superior long term returns and a good offer from Softbank, the board took the decision to sell," Sarin said in a statement.
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Mr Wong
