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Vodafone, Liberty Global end asset-swap talks

Vodafone has confirmed that discussions with Liberty Global regarding a possible exchange of selected assets between the two companies have terminated.

The pair revealed on June 5th that they were in the early stages of such talks.

At the time, Vodafone said there was no certainty that any transaction would be agreed, nor certainty with respect to which assets would ultimately be involved.

In May 2015, Liberty Global’s chairman John Malone boosted the chances of a tie-up with Vodafone in Western Europe, saying it would be a “great fit”.

“We’ve looked at that from our side and there would be very substantial synergies if we could find a way to work together or combine the companies,” he told Bloomberg.

Malone said he was of the view that a deal between the two companies could create “enormous shareholder value if we could work it out”.  Vodafone’s market cap is $93 billion, or twice that of Liberty’s not least because it carries far less debt than the cabler.

UK cable MSO Virgin Media, acquired by Liberty Global in February 2013 for $23.3 billion, had been seen as a prime target for Vodafone as it attempts to develop a quad-play offering better to compete with BT and Sky.

The company has expressed its ambitions in the pay-TV market and is planning to launch an IP-delivered entertainment service in the fourth quarter of 2015.

Any deal involving Virgin Media would follow Vodafone’s earlier cable MSO acquisitions, buying Kabel Deutschland in June 2013 for €7.7 billion, and Spanish cabler ONO in mid-March 2014 for €7.2 billion.

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