LONDON-Vodafone AirTouch plc announced it will not trade its single-A credit ratings for Mannesmann AG control by offering downgrade protection on some outstanding debt.
The company said it added covenants and events of default attached to the upcoming global bond issue to debt securities issued by AirTouch Communications Inc. before last year’s acquisition.
Feb. 7 is the deadline for Mannesmann shareholders to tender their shares.
Vodafone AirTouch has said it will not finance the deal by increasing debt.
In related news, more than 98 percent of Vodafone AirTouch’s shareholders last week approved the company’s $151 billion hostile takeover bid for Mannesmann.
Vodafone AirTouch said it might increase its offer but would not accept Mannesmann’s call for 58.5 percent of the combined group.
“Vodafone AirTouch’s offer also provides Mannesmann shareholders with 47.2 percent of the combined group, which represents a substantial premium to any other relevant measure of Mannesmann’s contribution to the combination,” said Chris Gent, chief executive of Vodafone AirTouch.
