Vodafone Says Must Put Activist Proposal To Shareholders
Published on: 8th Jun 2007
Note -- this news article is more than a year old.
LONDON (Dow Jones) Mobile phone operator Vodafone Group is required by law to put rebel investor proposals to shareholders at the company's forthcoming annual general meeting a spokesman for the company said Friday.
Activist shareholder group Efficient Capital Structures, led by former Marconi executive John Mayo, has called for four resolutions to be included at Vodafone's AGM on July 24. The resolutions urge Vodafone to restructure debt and separate its Verizon Wireless joint venture, in the belief that up to GBP38 billion can be returned to shareholders by doing so.
Despite the Vodafone board unanimously rejecting the resolutions Thursday, a Vodafone spokesman told Dow Jones Newswires that due to legal reasons it will have to put the resolutions to a shareholder vote.
"We will be putting the proposals to shareholders, however having reviewed these proposals we have unanimously concluded that continued execution of our strategy will deliver greater value for shareholders," he said.
On Thursday, Vodafone rejected claims from ECS that its 45% stake in Verizon Wireless wasn't returning enough value, adding that it had delivered superior growth and cash-generation benefits to Vodafone shareholders in recent years.
The Newbury, England-based operator said that it had already considered the idea of a Verizon Wireless tracking share, prior to ECS' suggestion, and deemed that such a share would trade at a material discount to the assets' fundamental value.
Responding to ECS' request that the mobile giant should issue bonds to shareholders to increase group leverage by GBP34 billion, Vodafone said that such an idea would create significant risk and constrain the company's future flexibility.
Company Web site: http://www.vodafone.com
-By Daniel Thomas, Dow Jones Newswires; 44-20-7842-9264; firstname.lastname@example.org
(END) Dow Jones Newswires"
Tags: verizon wireless