LONDON-As speculated earlier this week, Vodafone Group plc said it agreed to acquire AT&T’s Corp.’s 10-percent economic interest in Japan Telecom Co. for $1.35 billion in cash. Following the completion of the transaction, Vodafone will hold 25 percent of Japan Telecom’s equity.
The acquisition marks another triumph for Vodafone over rival British Telecommunications plc. AT&T, which was forced to sell its Japan Telecom stake following its partnership with Japan Telecom rival NTT DoCoMo late last year, has an agreement with BT, which also holds stakes in Japan Telecom, and AT&T was expected to sell its shares to BT.
Vodafone purchased a 15-percent stake in Japan Telecom last December following NTT DoCoMo’s acquisition of a 16-percent stake in AT&T Wireless Services Inc.
The transaction represents a price per Japan Telecom share of about $21,125, giving Japan Telecom an equity value of about $13.5 billion. The transaction is dependent on AT&T’s ability to deliver the shares at the end of April, when the closing is expected.
“Our purchase of AT&T’s stake in Japan Telecom underlines our conviction of the inherent strength of the Japanese market,” said Vodafone Chief Executive Chris Gent. “We look forward to working with our partners, Japan Telecom, British Telecom and the Japan Railway companies in Japan’s fast-moving innovative telecommunications market.”
Japan Telecom owns 54 percent the J-Phone Group wireless subsidiary, an important asset to Vodafone. Vodafone currently owns 26 percent of J-Phone, and British Telecom holds the remaining 20 percent. The Vodafone acquisition of further Japan Telecom shares will undoubtedly give it more control of the mobile subsidiary.
